Is Stellar Capital overvalued or undervalued?

Sep 02 2025 08:01 AM IST
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As of September 1, 2025, Stellar Capital is considered overvalued with a valuation grade of very expensive, reflected in its PE ratio of 17.07 and unfavorable comparisons to peers like Bajaj Finance and Life Insurance, despite a strong 1-year return of 27.85%.
As of 1 September 2025, Stellar Capital's valuation grade has moved from fair to very expensive, indicating a significant shift in its market positioning. The company is currently considered overvalued. Key ratios include a PE ratio of 17.07, an EV to EBIT of 17.06, and a Price to Book Value of 0.37, which suggest that the stock is trading at a premium compared to its earnings and book value.

In comparison to its peers, Stellar Capital's valuation metrics appear less favorable. For instance, Bajaj Finance has a much higher PE ratio of 31.81, while Life Insurance, which is rated very attractive, has a PE of 11.16. Additionally, Stellar Capital's PEG ratio of 0.14 further emphasizes its overvaluation relative to its growth prospects. Despite a strong recent performance with a 1-year return of 27.85% compared to the Sensex's -2.43%, the overall valuation suggests that investors should approach with caution.
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