Is Swan Energy overvalued or undervalued?

As of 17 February 2025, Swan Energy's valuation grade has moved from fair to risky, indicating a shift in the company's perceived financial stability. The company appears to be overvalued based on key financial metrics, including a PE ratio of 18.75, a Price to Book Value of 1.93, and a troubling EV to EBITDA ratio of -104.48. These figures suggest that the market may be pricing in more value than the company currently offers, especially when compared to peers like K P R Mill Ltd, which has a significantly higher PE ratio of 47.51, and Trident, which is rated fair with a PE of 42.6.
In the context of peer comparisons, Swan Energy's PEG ratio of 0.12 further emphasizes its overvaluation, particularly against competitors like Arvind Ltd, which boasts a PEG of 4.8 and is rated very attractive. The company's recent stock performance has also been underwhelming, with a year-to-date return of -36.74% compared to the Sensex's 5.58%, reinforcing the notion that Swan Energy may not be a sound investment at its current price of 455.45.