Is Ujjivan Small overvalued or undervalued?

As of 5 May 2025, the valuation grade for Ujjivan Small Finance Bank Ltd. has moved from attractive to very attractive, indicating a positive shift in its perceived value. The company is currently considered undervalued. Key ratios include a PE ratio of 12.76, a Price to Book Value of 1.55, and a Dividend Yield of 3.13%.
In comparison to its peers, Ujjivan's valuation stands out, especially with a PEG ratio of 0.00, suggesting strong growth potential relative to its price. Notable peers include companies like HDFC Bank, which has a PE ratio of approximately 20.5, and Axis Bank with a PE ratio of around 18.5, highlighting Ujjivan's attractive pricing in the market. Additionally, Ujjivan has outperformed the Sensex significantly in the past year, with a year-to-date return of 42.37% compared to the Sensex's 5.56%, reinforcing its undervaluation narrative.