Is Zydus Wellness overvalued or undervalued?

As of 11 November 2024, Zydus Wellness has moved from an expensive to a fair valuation grade. The company is currently fairly valued, with a PE ratio of 36.22, an EV to EBITDA of 32.80, and a PEG ratio of 1.68. In comparison to its peers, Zydus Wellness stands out against Hindustan Unilever, which is considered very expensive with a PE ratio of 53.88, and Nestle India, also very expensive with a PE ratio of 75.20.
While Zydus Wellness has shown a stock return of 14.26% over the past month, outperforming the Sensex's 3.87%, its long-term performance has lagged behind, with a 5-year return of 55.25% compared to the Sensex's 143.05%. Overall, the current valuation suggests that Zydus Wellness is positioned reasonably within its sector, especially when compared to significantly higher valuations of its peers.