Enter the current share price and EPS (earnings per share) to instantly calculate the PE ratio. Then select your sector to compare the stock's PE against the typical range for that sector.
The calculator also computes the PEG ratio (PE ÷ EPS growth rate) if you enter the expected growth rate — helping you assess whether a high PE is justified by strong earnings growth.
PE Ratio — Sector Benchmarks for Indian Stocks
Different sectors trade at structurally different PE ranges. A bank at PE 8 is not necessarily cheaper than an IT company at PE 25 — they operate in completely different businesses with different growth and risk profiles.
Sector
Typical PE Range
Below Range
Above Range
FMCG (HUL, Nestle, Dabur)
40–70×
Potentially undervalued or growth slowing
Premium for quality — check growth
IT Services (TCS, Infosys, Wipro)
18–30×
Earnings stress or slowdown
High growth expectation
Private Banks (HDFC, ICICI, Kotak)
15–25×
NPA concerns, slow loan growth
Strong earnings momentum
PSU Banks (SBI, Bank of Baroda)
5–10×
Deep stress or market panic
Strong earnings recovery
Pharma (Sun Pharma, Dr Reddy's)
20–35×
US FDA concerns, pricing pressure
Pipeline / new approvals priced in
Auto (Maruti, M&M, Bajaj Auto)
15–25×
Volume slowdown, EV uncertainty
Strong model cycle, EV optionality
Cement (UltraTech, Shree Cement)
20–35×
Demand slowdown, high input costs
Infrastructure boom cycle
Consumer Discretionary
25–50×
Weak consumer demand
Strong premiumisation trend
Nifty 50 (broad market)
18–24×
Market undervaluation / fear
Market overvaluation / euphoria
Ranges are historical averages for reference only. Actual PE values change with market conditions, earnings cycles, and interest rate environment.
PE Ratio Calculator
Enter the current share price, annual EPS, and optionally the expected EPS growth rate
Enter the current market price of one share
Trailing 12 months EPS — from annual report or screener
Compare your stock's PE to its sector benchmark
Used to calculate the PEG ratio — leave blank if unknown
How to Interpret Your PE Ratio
Once you have the PE ratio, the key question is: is this PE high or low relative to the sector, and is it justified? Here is a simple decision framework:
PE below sector range: Investigate why. If it is due to temporary bad news (a one-off charge, a cyclical downturn), it could be an opportunity. If earnings are structurally declining, avoid.
PE within sector range: The stock is fairly valued relative to peers. Check revenue growth, margin trends, and debt levels before deciding.
PE above sector range: A premium is being paid for quality, growth, or brand moat. Calculate the PEG ratio to check if earnings growth justifies the premium. A PEG below 1 suggests the high PE is reasonable.
Negative EPS: PE cannot be calculated for loss-making companies. Use Price/Sales or EV/Revenue instead.
Tip:
Always compare PE to the stock's own historical average in addition to the sector. A stock trading at PE 20 in a sector with a typical range of 20–25 looks fair — but if its own 5-year average is PE 12, it may actually be expensive on a historical basis.
Warning — The Cyclical Trap:
For cyclical sectors (steel, mining, commodities, real estate), a low PE at the peak of the cycle is a warning signal, not a buy signal. Earnings are temporarily high. In 1–2 years, when the cycle turns, earnings will crash and the stock will look expensive again. Use EV/EBITDA or Price/Book for cyclicals instead.
The PEG Ratio — PE Adjusted for Growth
The PEG ratio was popularised by legendary investor Peter Lynch. It adjusts the PE ratio for the company's earnings growth rate, giving a more complete picture of whether a high PE is justified.
PEG Ratio = PE Ratio ÷ EPS Growth Rate (%)
PEG < 1: Potentially undervalued relative to growth — classic "growth at a reasonable price"
PEG = 1: Fairly valued — you are paying for what the company will earn
PEG 1–2: Moderate premium — acceptable for high quality companies
PEG > 2: Expensive relative to growth — requires exceptional quality or near-certainty of high growth
Learn Fundamental Analysis — Read the Complete Guide
PE ratio is one of many tools. Our complete guide covers EPS, ROE, ROCE, balance sheets, cash flows, moats, and how to analyse any Indian stock from scratch.
For the most reliable result, use trailing twelve months (TTM) EPS — the sum of EPS from the last four quarters. This is based on actual reported numbers, not estimates. You can find it on screener.in, moneycontrol.com, or BSE/NSE company filings. Avoid using forward EPS for the PE calculation unless you have very high confidence in the analyst estimates, as forward PE can be misleading if estimates are too optimistic.
If a company has negative EPS, the PE ratio cannot be calculated — a negative PE is meaningless. For loss-making companies, use alternative metrics: Price/Sales (P/S ratio) for revenue-generating businesses, EV/Revenue, or simply track when the company is expected to reach profitability. Many high-growth tech and startup stocks trade on a "path to profitability" narrative rather than current earnings.
Not always — a low PE can be a value trap. Before buying a low-PE stock, always ask: why is it cheap? If the reason is temporary (a one-off expense, a cyclical downturn, a short-term management issue), it may be an opportunity. If the reason is structural (technology disruption, permanent margin compression, governance problems, declining industry), the low PE may be permanently justified and the stock will continue to underperform. Use screener.in to check 5-year EPS trend before acting on a low PE.
The easiest sources for TTM EPS of Indian stocks are: (1) screener.in — search for the company name, the PE and EPS are shown on the company page; (2) moneycontrol.com — financials section; (3) NSE/BSE filings — quarterly results announcements. For the calculator, you need the annual EPS (full year), not just one quarter's EPS. The annual EPS is typically disclosed in the Q4 results or annual report.
For companies with subsidiaries, always use consolidated EPS — it includes the earnings (and losses) of all subsidiaries and is a more accurate picture of the group's total earnings. Standalone EPS only covers the parent company. For companies with significant subsidiaries (like Reliance Industries, Tata Motors, Bajaj Finance), the difference between consolidated and standalone can be large. Most financial websites show consolidated figures by default.
