Real-world example
Company A has share price ₹100 and EPS ₹10. Its P/E is 10. Company B has share price ₹100 and EPS ₹2. Its P/E is 50. Company B is 'more expensive'.
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P/E Ratio (Price-to-Earnings)
A valuation ratio that compares a company's current share price to its earnings per share.
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- It tells you how much you are paying for ₹1 of profit.
- A P/E of 30 means you are paying ₹30 for every ₹1 the company earns.
- High P/E suggests high growth expectations. Low P/E suggests undervaluation or business problems.
See it in PortoAI
Compare P/E against peers for any stock.