Is Voltas overvalued or undervalued?

As of 18 August 2025, Voltas has moved from a fair to an expensive valuation grade. The company appears to be overvalued at its current price of 1,348.90, considering its high PE ratio of 68.92, an EV to EBITDA of 51.04, and a Price to Book Value of 6.85. These ratios indicate that investors are paying a premium for the stock compared to its earnings and book value.
In comparison to its peers, Voltas' PE ratio is lower than Johnson Controls' 118.15 but higher than Blue Star's 73.58, indicating a competitive but expensive positioning within the industry. The PEG ratio of 1.65 also suggests that the stock may not be justified at its current valuation given its growth prospects. While Voltas has shown strong returns over the long term, its recent performance has lagged behind the Sensex, with a year-to-date decline of 24.63% compared to the Sensex's gain of 4.01%.