The P/E ratio, or price-to-earnings ratio, is a valuation metric that compares a company's stock price to its earnings per share. It is calculated by dividing the market value per share by the annual earnings per share. The P/E ratio indicates what the market is willing to pay for a company's current and future earnings. A higher P/E ratio may show that the market expects higher future growth, but could also mean the stock is overvalued. Conversely, a lower P/E ratio could signal lack of market confidence but may also represent an undervalued stock with strong future potential. There is no single correct P/E ratio as it depends on an investor's willingness to pay for a company

9. Hope you have now understood the concept of P/E Ratio. In case of any query please email to hmasurkar@tataamc.com