Is United Spirits overvalued or undervalued?

As of 8 August 2025, the valuation grade for United Spirits has moved from expensive to very expensive, indicating a significant shift in its perceived value. The company is currently considered overvalued. Key ratios include a PE Ratio of 57.65, an EV to EBITDA of 40.75, and a PEG Ratio of 3.95, all of which are considerably high compared to industry norms.
In comparison to peers, Varun Beverages has a PE of 58.73 and an EV to EBITDA of 33.49, while United Breweries shows a PE of 108.55 and an EV to EBITDA of 58.87, highlighting that United Spirits, despite its high valuation, is still relatively lower than some competitors. Notably, the company's stock has underperformed against the Sensex over the past year, with a return of -11.53% compared to the Sensex's 1.23%, reinforcing the notion of overvaluation in the current market context.