Shares of Paras Defence and Space Technologies witnessed an upward movement during Wednesday's trading session, climbing nearly 1% to reach ₹717.50. This positive momentum comes on the back of two significant announcements from the small-cap defence company that have captured investor attention.
Strategic Partnership with DRDO
In a crucial development for India's defence manufacturing sector, Paras Defence revealed it has entered into a technology transfer agreement with the Defence Research and Development Organisation (DRDO). The formal announcement was made through an exchange filing on November 26, detailing the collaboration focused on the Driver Night Sight (DNS) system deployed in T-90 tanks.
This landmark agreement empowers Paras Defence to manufacture and work with advanced night-vision technology within India's borders. The DNS system represents a critical technological advancement that significantly enhances visibility for tank drivers operating in low-light and nighttime conditions. This capability is essential for maintaining armoured vehicle mobility and ensuring operational readiness during critical missions.
The partnership with DRDO, which functions under the Ministry of Defence, aligns perfectly with the government's broader vision of achieving self-reliance in defence manufacturing capabilities.
Impressive Quarterly Performance
Paras Defence delivered outstanding financial results for the September quarter, demonstrating robust growth across key metrics. The company reported a 50% year-on-year surge in net profit, climbing to ₹21 crore from ₹14 crore in the same period last year.
Revenue performance was equally impressive, with the company posting a 21.8% year-on-year increase to ₹106 crore. This growth was primarily driven by strong execution across its diverse business segments, including optics, defence electronics, and space engineering.
The company's operational efficiency showed marked improvement, with EBITDA jumping 32% year-on-year to ₹30 crore from ₹22.7 crore. This performance reflects tighter cost management and enhanced operational controls. The EBITDA margin also strengthened significantly, rising to 28.3% from 26.1% recorded a year earlier, highlighting the company's improved profitability.
Expanding Technological Capabilities
Beyond the DRDO partnership, Paras Defence continues to expand its technological footprint through additional strategic collaborations. Earlier on Monday, the company announced signing a Memorandum of Understanding with the Inter-University Accelerator Centre (IUAC), an autonomous institute operating under the University Grants Commission within the Ministry of Education.
This collaboration aims to combine the respective capabilities of both organizations to develop commercial-grade MRI magnet systems for indigenous manufacturing within India. The initiative supports the national objective of achieving self-reliance in superconducting MRI magnet technology, thereby nurturing the Aatma Nirbhar Bharat mission.
The recent developments come at a time when Paras Defence shares have experienced mixed performance across different time frames. While the stock has remained relatively flat over the past month and declined by 11.59% over six months, it has delivered nearly 39% returns in the last one year and an impressive 191% gain since its initial listing.
These strategic partnerships, combined with strong quarterly results, position Paras Defence as a key player in India's growing defence and technology manufacturing landscape, potentially setting the stage for continued growth in the coming quarters.
