diff --git a/erpnext/stock/doctype/serial_and_batch_bundle/serial_and_batch_bundle.py b/erpnext/stock/doctype/serial_and_batch_bundle/serial_and_batch_bundle.py
index 0655cd2cfd7..1992b5dc49f 100644
--- a/erpnext/stock/doctype/serial_and_batch_bundle/serial_and_batch_bundle.py
+++ b/erpnext/stock/doctype/serial_and_batch_bundle/serial_and_batch_bundle.py
@@ -667,8 +667,12 @@ class SerialandBatchBundle(Document):
 			if batches and valuation_method == "FIFO":
 				stock_queue = parse_json(prev_sle.stock_queue)
 
+		set_valuation_rate_for_rejected_materials = frappe.db.get_single_value(
+			"Buying Settings", "set_valuation_rate_for_rejected_materials"
+		)
+
 		for d in self.entries:
-			if self.is_rejected:
+			if self.is_rejected and not set_valuation_rate_for_rejected_materials:
 				rate = 0.0
 			elif (d.incoming_rate == rate) and not stock_queue and d.qty and d.stock_value_difference:
 				continue