Paramount Comm. (PARACABLES)
CyclicalFairStock Score: 35/100 — MIXED
Score breakdown: P/E: 2/3 · ROCE: 1/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹65.27 |
| Market Cap | ₹2,135.89 Cr |
| P/E Ratio | 33.3 |
| ROCE | 16.3% |
| ROE | 8.67% |
| Dividend Yield | 0% |
| Profit Growth | 8.1% |
| Debt/Equity | 0.16 |
| Sales Growth | 13.1% |
| Promoter Holding | 49.12% |
| 52-Week Range | ₹28.3 — ₹75.7 |
| Sector | Industrial Products |
| Book Value | ₹25.49 |
Strengths
- Sales growth of 17.69% indicates healthy demand for cables.
- ROCE of 16.30% suggests capital employed is generating a reasonable return.
- Low debt/equity of 0.14 gives balance sheet resilience.
- Promoter holding of 49.12% aligns management with minority shareholders.
Concerns
- Profit growth of -66.99% with net profit of only ₹7 Cr on sales of ₹461 Cr shows severe margin compression.
- P/E of 18.35 on declining earnings is not a value entry, and dividend yield is 0.00%.
- ROE of 8.67% and Piotroski F-score of 4/9 indicate weak fundamentals and possible deterioration.
- PEG of 1.04 is based on sales growth, but profit growth is negative, making the valuation misleading.
AI Analysis
Paramount Communications gives me mixed signals. Sales rose 17.69%, but profit fell 66.99%. That alone tells me the company is generating revenue without converting it into owner earnings. In the latest quarter, sales were ₹461 Cr, yet net profit was only ₹7 Cr — that is a razor-thin margin, roughly 1.5%. As an investor, I prefer a business that earns a margin of safety, not just on price, but in earnings power. The balance sheet looks acceptable: debt/equity is 0.14, so financial distress is not the issue. ROCE of 16.30% shows the capital employed is earning a fair return. But ROE is only 8.67%, which is below my threshold for a compounding asset. Dividend yield is 0.00%, so I receive no cash while I wait. Promoter holding of 49.12% is decent alignment, but it does not guarantee good capital allocation. At ₹38.07, the P/E is 18.35, based on depressed profits; this is not a cheap price. P/B of 1.70 means I am paying a premium over book value of ₹22.37. The Piotroski F-score of 4/9 is a serious warning. The PEG of 1.04 is misleading because it uses sales growth, while profit growth is negative. This has the feel of a cyclical business whose earnings have hit a soft patch. The stock is down from ₹75.70, but a fallen price is not my margin of safety. I want to see several quarters of consistent profit recovery, margin expansion, and a clearer moat. Until then, this belongs on my watchlist, not in my portfolio.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer