Paras Defence and Space Technologies shares are one of the multibagger stocks that the Indian share market has delivered in 2024, thanks to its strong order book and robust financial performance. The smallcap defence stock, which made its market debut in October 2021, has more than doubled in less than 5 months, while it zoomed more than 6 times since its listing. The multibagger stock has soared 635% from its initial public offering (IPO) price of ₹175 on October 1, 2021, to ₹1,293.30 apiece today. It has zoomed 112% against its 52-week low of ₹608.75 hit on March 28, 2024.
On Thursday, shares of Paras Defence gained as much as 5% to touch its upper circuit limit of ₹1,293.30 on the BSE, while its market capitalisation rose to ₹4,980 crore. Snapping two sessions losing streak, the defence stock opened higher at ₹1,284.85 against the previous closing price of ₹1,231.75.
On the technical front, the stock is in a “mildly bullish” range, trading higher than 5-day, 20-day, 100-day and 200-day moving averages, but lower than 50-day moving averages.
At the current price, the share price of Paras Defence trades 19% lower than its all-time high of ₹1,592.75 touched on July 5, 2024. In the last one year, the counter has risen 88%, while it gained 72% in the past six months. In the calendar year 2024, the stock jumped over 69%, while it lost over 7% in a month as investors booked some profit at higher levels.
Paras Defence shares got a boost today after the company informed exchanges that it has been granted an industrial licence from the Department for Promotion of Industry & Internal Trade (DPIIT) to manufacture various defence-related products in its industrial undertaking in Navi Mumbai, Maharashtra. The license will allow the company to manufacture defence products such as infrared and thermal imaging equipment, electro-optics systems, radar systems, and border security surveillance systems. The license is valid for 15 years.
Established in 1971, Paras Defence designs, develops and manufactures a wide range of engineering products and solutions for the defence and space sector in the domain of optics, heavy engineering and electronics. It has two manufacturing facilities – one in Ambernath (Thane) and the other in Nerul (Navi Mumbai).
For the first quarter ended June 30, 2024, the company posted net profit of ₹14.11 crore as compared to ₹5.81 in the same period last year. Revenue increased by 73% year-on-year to ₹83.57 crore, while EBITDA rose 123% YoY to ₹24.12 crore. The EBITDA margin improved to 28.9% from 22.4% in the same period the previous year.
Paras Defence’s fresh order inflows over the past four fiscal years remained adequate, with orders worth ₹621 crore added in the last 21 months ending December 31, 2023. The pending order book of ₹526.3 crore as on December 31, 2023 provides medium-term revenue visibility, as per ICRA report released in April this year.
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