Paramount Communications Reports Strong Q2 Growth

Revenue grew 31.1% YoY to INR 560.4 crore, while operating margins improved to 7.3%.

Reader Takeaway: Revenue growth and margin recovery remain on track, though Narmadapuram commissioning timelines require steady execution monitoring.

What just happened

Paramount Communications delivered a robust performance for Q2 FY27, with top-line growth fueled by consistent demand in the power and distribution sector. Operating profit climbed to INR 40.9 crore, marking a steady recovery from 1.3% in the year-ago period to 7.3% this quarter. The company maintained a PAT of INR 24.2 crore and an EPS of INR 0.74.

Why this matters

The company is strategically shifting its product mix toward high-margin specialized conductors. With an order book of INR 731 crore, management is prioritizing shorter-cycle contracts to protect against volatility in metal prices. This disciplined approach is expected to sustain current growth momentum.

The Narmadapuram Expansion

The greenfield project in Madhya Pradesh is a critical pillar for future valuation. Scheduled for partial commissioning in Q1 FY28, it will enable the production of EHV cables up to 220 kV and e-beam cables. Projections suggest this facility could contribute INR 500 crore in revenue in FY28, rising to INR 1,200 crore by FY29.

Risks to watch

Investors should note the working capital cycle, which rose to 108 days from 101 days at the end of FY26. While management expects normalization in H2, the execution of the Narmadapuram plant is heavily dependent on technical approvals for EHV cables, which may take up to 18 months.

What to track next

The market will look for the company to hit its 8% operating margin target by the end of Q4 FY27. Additionally, the ability to maintain a debt-equity ratio near 0.3 despite the heavy capital expenditure will be a key signal of balance sheet health.