Is Tata Steel overvalued or undervalued?

As of 10 July 2025, Tata Steel's valuation grade has moved from attractive to fair, indicating a shift in its perceived value. The company is currently fairly valued, with a PE ratio of 52.96, an EV to EBITDA ratio of 11.20, and a ROE of 4.15%. In comparison to its peers, JSW Steel has a higher PE ratio of 67.34 and an EV to EBITDA of 14.59, while Jindal Steel, rated as attractive, shows a significantly lower PE ratio of 23.79 and an EV to EBITDA of 11.45.
Despite the recent performance, where Tata Steel has outperformed the Sensex on a year-to-date basis with a return of 16.33% compared to the Sensex's 6.46%, its valuation metrics suggest that it is fairly priced relative to its peers. The current market conditions and peer comparisons indicate that Tata Steel is not undervalued or overvalued but rather reflects a fair valuation in the current market landscape.