The National Stock Exchange (NSE) is India’s leading stock exchange, covering different geographic locations across the country. Midcap is a rough term that includes companies and stocks between large-cap and small-cap stocks. The classification of each company’s shares depends on its market value. This study presents a comparative analysis of intrinsic versus market valuations of selected mid-cap stocks listed on the National Stock Exchange (NSE) of India using the Dividend Discount Model (DDM) and Capital Asset Pricing Model (CAPM). By evaluating 10 mid-cap companies across various sectors with 10 years of historical data, the research identifies a consistent pattern of overvaluation in market prices relative to their intrinsic values. CAPM-based expected returns, which consider risk through beta, ranged from 8.86% to 17.2% but did not align with the inflated market values, indicating potential mispricing due to speculative investor behavior or sentiment-driven trading. A t-test analysis confirmed a statistically significant difference between intrinsic and market values (p = 0.056), further supporting the hypothesis of systematic overvaluation. The findings suggest a diversion between fundamental valuation and actual stock pricing in mid-cap segments, raising concerns about market efficiency. For researchers, this opens pathways for studying behavioral finance and refining valuation models in emerging markets. Practitioners, especially investors and advisors, are advised to supplement market indicators with fundamental analysis tools like DDM to make informed decisions. Despite limitations such as small sample size and model assumptions, the study offers valuable insights into valuation practices and market behavior in India’s capital market context.