Paramount expands operating margin as revenue growth outpaces costs
Consolidated net profit rose +23.05% QoQ, but higher interest and a sizeable contribution from other income temper the quality of the increase.
Filed 26 Oct 2026, 15:57 IST · after market close · Paramount Communications Ltd (PARACABLES)
Key takeaways
- Consolidated operating margin expanded 0.74 percentage points QoQ to 7.30% as revenue grew +5.86%, faster than expenses at +5.02%.
- Consolidated net profit rose +23.05% QoQ to Rs 24.24 cr, although interest expense increased +15.01% and other income contributed 11.73% of PBT.
- Paramount's 7.30% operating margin was 3.69 percentage points below the 10.99% median for 30 reported Industrials peers.
Price around the results
Revenue momentum lifted Q2FY27 profitability
Paramount's consolidated revenue increased +5.86% QoQ to Rs 560.4 cr, while expenses rose +5.02%, allowing operating profit to grow faster at +17.76%. This lifted operating margin by 0.74 percentage points from Q1FY27, reversing the pressure that would have resulted if costs had outpaced sales.
Interest rose faster than operating profit below the line
Interest expense increased +15.01% QoQ, while depreciation was unchanged, limiting the conversion of operating profit into pre-tax profit. The tax rate fell by 0.61 percentage points to 25.16%, which helped net profit grow +23.05%; other income also accounted for 11.73% of PBT, so the quarter's earnings were not entirely operating-led.
Margin remains below the Industrials peer median
Paramount's 7.30% operating margin was 3.69 percentage points below the 10.99% median among 30 Industrials companies that have reported the same quarter. With only Q1FY27 in the supplied trend, the available direction is a sequential 0.74-point margin improvement rather than evidence of a multi-quarter trend.
Management highlighted HTLS orders and Narmadapuram expansion
Management said it is focused on restoring operating profitability, improving product mix and pursuing international expansion prudently; it also said the company has an HTLS order book exceeding Rs 200 cr. The company told investors that partial commissioning of the Narmadapuram project is planned for Q1 FY28, with conductor capability up to 765 kV planned to be augmented in FY28. Management said long-term wires and cables demand remains encouraging, and presented turnover targets of Rs 500 cr for FY28 and Rs 1,200 cr for FY29.
Results were filed after market close
The consolidated results were filed after market close on 26 October 2026. A post-results stock reaction is therefore not assessed here.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹560 cr | ₹529 cr | +5.86% |
| Other income | ₹4 cr | ₹3 cr | +22.98% |
| Expenses | ₹519 cr | ₹495 cr | +5.02% |
| Operating profit | ₹41 cr | ₹35 cr | +17.76% |
| Operating margin (%) | 7.30% | 6.56% | — |
| Interest | ₹8 cr | ₹7 cr | +15.01% |
| Depreciation | ₹4 cr | ₹4 cr | +0.00% |
| Profit before tax | ₹32 cr | ₹27 cr | +22.04% |
| Tax | ₹8 cr | ₹7 cr | +19.15% |
| Net profit | ₹24 cr | ₹20 cr | +23.05% |
| EPS (₹) | ₹0.74 | ₹0.64 | +15.62% |
Operating margin of 7.30% compares with a Industrials sector median of 10.99% across 30 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +9.83% | +9.84% |
Volume on the results session was 11.07× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- The company expects long-term wires and cables demand to remain encouraging, driven by power, renewable energy and infrastructure investments.
- Management is focused on restoring operating profitability, prudent international expansion and improving its product mix.
- The company is targeting turnover of ₹500 crore in FY28 and ₹1,200 crore in FY29.
- Partial commissioning of the Narmadapuram project is planned for Q1 FY28.
Expansion
- Manufacturing capability for conductors up to 765 kV is planned to be augmented at Narmadapuram in FY28.
New orders
- The company has an HTLS order book exceeding ₹200 crore, with additional tenders under bid and finalization.
New initiatives
- Paramount has two HTLS technologies, carbon-core and GAP, covering the full range of tender specifications.
Problems & risks
- The company reported that US demand was down during the USA de-stocking year.
What to watch
- Whether consolidated operating margin holds above 7.30% after its 0.74-point QoQ expansion.
- Whether interest expense moderates after rising +15.01% QoQ.
- Whether the HTLS order book remains above Rs 200 cr as the Narmadapuram project approaches its planned Q1 FY28 partial commissioning.