Is Titagarh Rail overvalued or undervalued?

As of 14 August 2025, the valuation grade for Titagarh Rail has moved from expensive to fair. The company is currently fairly valued, with a PE ratio of 45.32, an EV to EBITDA ratio of 27.25, and a ROCE of 15.27%. In comparison, its peers Rites and Oriental Rail have PE ratios of 31.19 and 33.68, respectively, indicating that Titagarh Rail's valuation is in line with the industry average.
Despite its fair valuation, Titagarh Rail has experienced significant stock underperformance relative to the Sensex, with a year-to-date return of -26.73% compared to the Sensex's 3.15%. This discrepancy highlights potential market concerns despite the company's reasonable valuation metrics. Overall, Titagarh Rail appears to be fairly valued in the current market environment.