Is Tata Steel overvalued or undervalued?

As of 11 July 2025, Tata Steel's valuation grade has moved from fair to attractive, indicating a positive shift in its market perception. The company is currently considered undervalued, with a price-to-earnings (PE) ratio of 52.69, an EV to EBITDA ratio of 11.16, and a PEG ratio of 1.36. These figures suggest that despite a high PE ratio, the company's growth potential relative to its earnings is favorable.
In comparison to its peers, Tata Steel's valuation metrics stand out, particularly when contrasted with JSW Steel, which has a PE ratio of 67.26 and an EV to EBITDA of 14.58, indicating that Tata Steel is more attractively priced. Additionally, Jindal Steel, another peer, has a significantly lower PE ratio of 23.66, reinforcing the notion that Tata Steel is undervalued relative to its industry. Notably, Tata Steel has outperformed the Sensex year-to-date with a return of 15.75% compared to the Sensex's 5.58%, further supporting its attractive valuation.