Is TCI Finance overvalued or undervalued?

Oct 12 2025 08:06 AM IST
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As of October 10, 2025, TCI Finance is overvalued with a PE ratio of 4.56 and negative key ratios, indicating financial instability, despite a recent stock return of 9.28% compared to the Sensex's 1.59%, but a year-to-date decline of -34.21% versus the Sensex's 5.58%.
As of 10 October 2025, TCI Finance has moved from a risky to a very expensive valuation grade. The company is currently overvalued, with a PE ratio of 4.56, an EV to EBIT of -5.10, and a PEG ratio of 0.01, indicating significant concerns regarding its financial health and profitability.

When compared to peers, TCI Finance's valuation metrics starkly contrast with Bajaj Finance, which has a PE ratio of 36.56, and Life Insurance, boasting a PE ratio of 11.65. The negative values in key ratios such as EV to Capital Employed (-0.22) and ROE (negative BV) further emphasize the company's precarious position. Despite a recent one-week stock return of 9.28% against the Sensex's 1.59%, the overall trend shows a concerning decline in performance, particularly with a year-to-date return of -34.21% compared to the Sensex's 5.58%.
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