Cable stocks in India represent a significant segment of the stock market, encompassing companies involved in the manufacturing and distribution of various types of cables, including power cables, communication cables, and speciality cables.
The sector has shown growth potential, driven by increasing demand in infrastructure, telecommunications, and renewable energy projects.
Listed below is one such smallcap stock that has an order of more than 500 crores:
Paramount Communications Ltd
With a market capitalization of Rs. 2,664 crores, the shares of Paramount Communications started Tuesday’s trading session on a higher note at Rs. 90.50 compared to its previous close of Rs. 89.96.
During the trading session, the shares hit a low of Rs. 87.60, losing around 3 percent and closed the day at Rs. 87 apiece.
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Financials
Looking at the company’s financial performance, the revenue decreased marginally by 0.6 percent from Rs. 323 crores during the March quarter to Rs. 321 crores in the June quarter. On the other hand, the net profits declined by around 14 percent from Rs. 29 crores to Rs. 25 crores during the same period.
Comparing the same metrics on a YoY basis, the revenue surged by 52 percent from Rs. 211 crores during Q1FY24 to Rs. 321 crores in Q1FY25. In addition, the net profits zoomed by around 67 percent from Rs. 15 crores to Rs. 25 crores during the same timeframe.
Revenue sources
The company generates revenue from a diverse range of products, primarily 37.5 percent of its revenue comes from Power Cables, approximately 20 percent from Railway Cables, and the remaining 42.5 percent is derived from Telecom Cables, House Wires, Exports, EPC Projects, Pipes, and other sources.
Orderbook
According to the latest data, the company holds a strong order book valued at Rs. 555 crores. Of this, approximately 53 percent of the orders are for Power Cables, 37 percent are for Exports, and the remainder is allocated to Railway Cables, Telecom Cables, House Wires, and EPC Projects.
The company operates in a highly favourable business environment, supported by growing demand in railways, power, renewable energy, and telecommunications, which drives its growth and expansion.
Increased government spending and private investments in infrastructure and construction are positively impacting the cable and wire industry. The company’s strong order book, balanced mix of export and domestic sales, and successful presence in the USA B2C market are key factors contributing to its performance.
Paramount Communications Ltd has a prestigious and diverse customer base that includes government entities, institutional clients, and major private sector organizations, both domestically and internationally.
Key clients encompass Indian Railways, BSNL, RailTel, Tata Projects Limited, Adani Power, and Siemens, among others. Further, the company operates two main manufacturing facilities located in Khushkhera, Rajasthan, and Dharuhera, Haryana, focusing on a diverse range of products.
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Key metrics
In terms of key financial metrics, the company reported a Return on Equity (RoE) of 13.67 percent and a return on capital employed (RoCE) of 13.66 percent for the period spanning FY23-24. Further, the net profit margin during FY23-24 was at 7.99 percent.
Additionally, the company has a low debt-to-equity ratio of 0.17 percent which means it has not relied much on debt to fund its operation.
Paramount Communications Ltd is a leading manufacturer of a wide variety of cables and wires in India, with over six decades of experience.
The company specializes in producing power cables (including HT, LT, and aerial bunch cables), telecommunication cables (optical fibre, jelly-filled, and fibre-to-the-home), railway cables (signalling and axle counter), and specialized cables (instrumentation, fire survival, and solar) for diverse sectors.
Written By Vaibhav Patil
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