Is Usha Martin overvalued or undervalued?

Aug 18 2025 08:06 AM IST
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As of August 14, 2025, Usha Martin is considered overvalued with a PE ratio of 26.45, significantly higher than its peers, and has underperformed the Sensex year-to-date, indicating a shift in market perception from fair to expensive.
As of 14 August 2025, Usha Martin's valuation grade has moved from fair to expensive, indicating a shift in its market perception. The company is currently overvalued, with a PE ratio of 26.45, a Price to Book Value of 3.89, and an EV to EBITDA of 18.44. These ratios suggest that the stock is trading at a premium compared to its earnings and asset values.

In comparison to its peers, Usha Martin's PE ratio is significantly higher than that of Jindal Steel, which has a PE of 23.72, and SAIL, with a PE of 16.33, both of which are categorized as attractive or fair. Additionally, while Usha Martin has a ROCE of 17.25% and ROE of 14.80%, these figures do not sufficiently justify its current valuation. The company's recent stock performance has lagged behind the Sensex, particularly in the year-to-date period, where it returned -6.63% compared to the Sensex's 3.15%.
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