Paras Defence & Space Technologies Ltd. (PARAS) AI Stock Analysis

• Market Cap: ₹57.43B
• Dividend Yield: 0.07%
• Average Volume (3M): 59.70K
• Price to Earnings (P/E): 78.2
• Beta (1Y): 1.95
• Revenue Growth: 24.92%
• EPS Growth: 50.07%
• Country: IN
• Employees: 418
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 2.30
• Shares Outstanding: 80,587,330
• 10 Day Avg. Volume: 48,476
• 30 Day Avg. Volume: 59,699
• PEG Ratio: 0.64
• Price to Book (P/B): 6.05
• Price to Sales (P/S): 10.62
• P/FCF Ratio: 403.69
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: ₹680.00 ▼(-1.90% Downside)

Paras Defence & Space Technologies Ltd. shows strong financial performance with robust revenue growth and improved margins. However, the high P/E ratio suggests overvaluation, and technical indicators point to neutral to slightly negative momentum. The lack of earnings call data and corporate events limits further insights.

Positive Factors

Revenue growth and margin expansion

Sustained revenue growth coupled with rising gross and net margins indicates durable demand for its defense and space products and improving operational efficiency. This supports ongoing investment in R&D and capacity, strengthening long-term cash generation and competitive positioning.

Improving leverage and equity base

A stronger equity base and falling debt-to-equity ratio enhance financial flexibility and reduce refinancing risk. This structural improvement provides capacity to fund strategic programs, absorb contract timing variability, and pursue partnerships without stressing solvency over the medium term.

Stronger cash flow trends

Improving operating and free cash flow trends point to better cash conversion from operations, enabling self-funding of capex and R&D. Durable cash generation reduces reliance on external financing and supports steady execution of long-term defense and space projects.

Negative Factors

Elevated total liabilities

Persistently elevated total liabilities can constrain capital allocation and raise refinancing burdens during downturns. For a capital-intensive defense supplier, managing payables, contract liabilities and lease obligations is critical to preserve liquidity and avoid pressure on operational execution.

Volatile free cash flow and high capex

Inconsistent free cash flow and sizable capex cycles increase funding uncertainty and magnify the impact of delayed contracts. Over multiple quarters this can strain liquidity, force opportunistic financing, and complicate long-term planning for production scale-up and R&D investment.

Net income volatility

Earnings volatility reduces predictability of margins and cash generation, complicating budgeting for long-term programs and investor visibility. For a defense supplier reliant on multi-year contracts, inconsistent profitability raises execution and pricing risks tied to program mix and cost absorption.

Paras Defence & Space Technologies Ltd. Business Overview & Revenue Model

Company Description

Paras Defence and Space Technologies Limited designs, develops, manufactures, and tests defense and space engineering products and solutions in India and internationally. The company provides rugged networking and communication, rugged display and computing, and rugged command and control systems; mechanical products, including flow formed tubes; and avionic suites, as well as automated test equipment. It also offers diffractive gratings, Zerodur and metal mirrors, optical domes, gyro blocks, multifold and IR lenses, reflectors and coatings, deployable space antennas, CFRP structures, lens barrels, and ultra-precision manufacturing products; rugged wired cabinets, shielded doors, honey comb filters, turnkey indigo simulator systems, submarine winches, titanium assemblies, and acoustic and magnetic sensing products, as well as naval electronic time fuze, naval chart, other software modules, and transducer positioning systems and platforms; high performance embedded computing systems, substitution sub-systems, tank imaging components and sub-assemblies, turret stabilizations, tri-pods and quadri-pods, and red dot reflex sight products; and heavy duty antenna mechanical structures, rugged cots systems, data/video/image processing systems, and active array cooling assemblies, as well as software development and system integration services. In addition, the company provides Electro-Magnetic Pulse (EMP) shielded rooms and control centers, anechoic shielded chambers, shielded doors, racks and cabinets, shielded air vents and windows, filters, EMP hardened products, and anechoic shielded chambers, as well as turnkey EMP projects. The company was formerly known as Paras Flowform Engineering Limited and changed its name to Paras Defence and Space Technologies Limited. The company was incorporated in 2009 and is headquartered in Navi Mumbai, India.

How the Company Makes Money

PARAS generates revenue through multiple streams, primarily by supplying advanced defense and aerospace products to government and private sector clients. The company secures contracts with various defense ministries and agencies, focusing on high-tech solutions for surveillance, reconnaissance, and communication. Significant revenue is also derived from research and development collaborations with other defense firms and institutions, allowing PARAS to innovate and expand its product offerings. Additionally, partnerships with international defense companies enhance its market presence and enable access to new technologies, contributing positively to its earnings.

Paras Defence & Space Technologies Ltd. Financial Statement Overview

Summary

Paras Defence & Space Technologies Ltd. has demonstrated strong revenue growth and improved profit margins. The balance sheet shows a healthy equity base and declining leverage, though challenges with total liabilities remain. Cash flow improvements are notable, despite historical fluctuations.

Income Statement

Paras Defence & Space Technologies Ltd. has demonstrated strong revenue growth over the years, with a notable increase from 2024 to 2025. The gross profit margin and net profit margins have also shown improvement, reflecting enhanced operational efficiency. EBIT and EBITDA margins have improved significantly, indicating robust profitability. However, the volatility in net income in previous years suggests potential risk factors that need monitoring.

Balance Sheet

The balance sheet reflects a healthy equity base with a consistent increase in stockholders' equity, contributing to a favorable equity ratio. The debt-to-equity ratio has declined, indicating better leverage management. However, the company still faces challenges with total liabilities, which require careful management to maintain financial stability.

Cash Flow

The cash flow statement reveals positive trends in free cash flow growth and operating cash flow improvement in recent years. However, historical fluctuations in free cash flow and significant capital expenditure highlight the need for strategic cash management. The operating cash flow to net income ratio has improved, indicating better cash conversion efficiency.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.74B	3.65B	2.53B	2.22B	1.83B	1.43B
Gross Profit	2.00B	1.94B	691.21M	704.98M	826.14M	653.41M
EBITDA	1.01B	972.10M	573.74M	659.99M	551.27M	445.31M
Net Income	634.90M	634.70M	320.60M	360.70M	270.43M	157.26M
Balance Sheet
Total Assets	0.00	8.52B	6.40B	5.21B	4.58B	3.63B
Cash, Cash Equivalents and Short-Term Investments	1.11B	1.13B	29.82M	321.07M	691.90M	56.83M
Total Debt	0.00	240.20M	658.04M	146.30M	310.80M	1.06B
Total Liabilities	-6.37B	2.15B	1.96B	1.07B	791.47M	1.56B
Stockholders Equity	6.37B	6.40B	4.45B	4.13B	3.78B	2.07B
Cash Flow
Free Cash Flow	0.00	95.90M	-715.49M	263.10M	29.06M	-10.40M
Operating Cash Flow	0.00	448.20M	-455.60M	495.00M	115.11M	42.85M
Investing Cash Flow	0.00	-869.90M	-16.85M	95.20M	-771.06M	-62.64M
Financing Cash Flow	0.00	736.60M	331.04M	-450.90M	630.98M	53.79M

Paras Defence & Space Technologies Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 693.15
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:PARAS, the sentiment is Positive. The current price of 693.15 is above the 20-day moving average (MA) of 668.53, above the 50-day MA of 676.54, and below the 200-day MA of 714.44, indicating a neutral trend. The MACD of -0.36 indicates Negative momentum. The RSI at 62.51 is Neutral, neither overbought nor oversold. The STOCH value of 93.08 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:PARAS.

Paras Defence & Space Technologies Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GNA	73 Outperform	₹15.46B	14.72	―	0.95%	-4.65%	9.95%
PARAS	68 Neutral	₹57.43B	78.20	―	0.07%	24.92%	50.07%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
RKFORGE	54 Neutral	₹92.61B	42.88	―	0.38%	-4.73%	-19.52%

Paras Defence & Space Technologies Ltd. Corporate Events

Paras Defence to Form Semiconductor Packaging Subsidiary Focused on AI and HPC

Paras Defence & Space Technologies Ltd. has approved the incorporation of a new wholly owned subsidiary, Paras Semiconductors Private Limited, with an authorised and paid-up share capital of ₹10 lakh. The subsidiary will operate in the semiconductor industry and is being formed to establish a state-of-the-art advanced heterogeneous packaging and 3D packaging OSAT (Outsourced Semiconductor Assembly and Testing) facility, targeting AI, high-performance computing, networking and data centre applications. This move signals Paras Defence’s strategic diversification into semiconductor packaging, potentially strengthening its position in high-tech manufacturing, aligning it with growing domestic and global demand for advanced chip packaging services, and broadening its relevance across defence, data infrastructure and next-generation computing ecosystems.

Paras Defence Re-appoints Suresh Katyal as Independent Director for Second Five-Year Term

Paras Defence and Space Technologies has announced that shareholders have approved the re-appointment of Mr. Suresh Katyal as a Non-Executive Independent Director for a second five-year term starting January 5, 2026 and ending January 4, 2031, via a postal ballot concluded on December 19, 2025. Katyal, who has been on the board since January 2021 and brings 38 years of experience at Bharat Electronics Limited across product assurance, quality control, testing, telecom, broadcasting and defence, is seen as a key contributor to the company’s governance and strategic oversight, particularly on technology, compliance and product quality matters, reinforcing the board’s depth as the company navigates complex defence-related projects.

Paras Defence to Engage with Investors at Midcap Conference 2025

Paras Defence & Space Technologies Ltd. has announced its participation in the Midcap Conference 2025, organized by Kotak Institutional Equities, where it will engage with analysts and institutional investors through one-on-one and group meetings. This engagement is part of the company’s strategy to strengthen its relationships with key stakeholders and enhance its visibility in the investment community, potentially impacting its market perception and investor confidence.