Is Vishal Fabrics overvalued or undervalued?

As of 1 July 2025, the valuation grade for Vishal Fabrics has moved from attractive to very attractive, indicating a significant improvement in its perceived value. The company is currently considered undervalued based on its financial ratios, which include a PE ratio of 31.16, an EV to EBITDA of 8.81, and a ROCE of 10.99%. These figures suggest that the company is performing well relative to its earnings and capital efficiency.
In comparison to its peers, Vishal Fabrics stands out with a lower PE ratio than K P R Mill Ltd, which has a PE of 46.46, and Trident, which has a PE of 42.97. Additionally, its EV to EBITDA ratio of 8.81 is more favorable compared to K P R Mill Ltd's 30.3, indicating that Vishal Fabrics is more efficiently valued in terms of its earnings potential. Notably, the company's stock has outperformed the Sensex over the past year, with a return of 48.30% compared to the Sensex's 5.31%, reinforcing the argument for its undervaluation.