Is Thinking Hats overvalued or undervalued?

As of 26 August 2025, the valuation grade for Thinking Hats has moved from very attractive to fair. This suggests a shift in market perception, indicating that the company may be fairly valued at this time. The key ratios reflect a price-to-earnings (P/E) ratio of 10.09, an EV to EBITDA ratio of 6.09, and a return on equity (ROE) of 33.37%.
In comparison to peers, Thinking Hats' P/E ratio is lower than PVR Inox's 10.92 and significantly lower than Prime Focus's 24.58, which indicates that while it is fairly valued, it may still present an opportunity for investors looking for value in the media and entertainment sector. Despite a recent decline in stock price, with a year-to-date return of -30.48% compared to a 4.51% gain in the Sensex, the company's strong ROCE of 84.55% suggests operational efficiency that could support future growth. Overall, Thinking Hats appears to be fairly valued at this juncture.