Is Tata Chemicals overvalued or undervalued?

As of 3 November 2025, Tata Chemicals' valuation grade has moved from very attractive to fair, indicating a shift in market perception. The company is currently fairly valued, with a PE ratio of 60.36, an EV to EBITDA of 14.36, and a Price to Book Value of 1.03. In comparison to peers, Adani Enterprises is considered expensive with a PE of 83.72, while DCM Shriram is attractive with a PE of 28.02, highlighting Tata Chemicals' relatively high valuation in the current market context.
The company's recent stock performance has been underwhelming, with a year-to-date return of -16.60%, significantly lagging behind the Sensex's gain of 7.47% over the same period. This underperformance, coupled with a low ROCE of 2.97% and ROE of 1.71%, suggests that while Tata Chemicals is fairly valued, it may face challenges in delivering strong returns compared to its peers and the broader market.