Quarterly Financial Performance Surges
In the quarter ended December 2025, Paragon Finance posted its strongest financial results to date. The company’s Profit Before Depreciation, Interest and Taxes (PBDIT) reached ₹0.55 crore, marking a significant improvement over previous quarters. Profit Before Tax excluding Other Income (PBT less OI) also hit a record ₹0.48 crore, signalling robust core operational profitability.
Most notably, the company reported a Profit After Tax (PAT) of ₹1.80 crore, the highest in its recent history, alongside an Earnings Per Share (EPS) of ₹4.24. This EPS figure represents a substantial uplift compared to prior quarters, underscoring the company’s improved earnings quality and operational efficiency.
The financial trend parameter for Paragon Finance has shifted from flat to positive, with the score improving markedly from 1 to 16 over the last three months. This shift reflects the company’s ability to generate stronger revenue growth and margin expansion, reversing a period of stagnation.
Challenges Persist Despite Earnings Growth
However, not all metrics paint a rosy picture. The company’s cash and cash equivalents at the half-year mark have declined to a low of ₹0.78 crore, raising concerns about liquidity management. Additionally, non-operating income accounted for a substantial 78.08% of Profit Before Tax in the quarter, indicating that a significant portion of profitability is derived from non-core activities rather than sustainable operational earnings.
This reliance on non-operating income could pose risks if such income streams are volatile or non-recurring, potentially impacting future earnings stability.
Stock Price and Market Performance
Paragon Finance’s stock price closed at ₹50.05 on 11 Feb 2026, down 1.84% from the previous close of ₹50.99. The stock traded within a range of ₹48.00 to ₹52.01 during the day, remaining well below its 52-week high of ₹69.99 but comfortably above the 52-week low of ₹38.20.
Examining the stock’s returns relative to the Sensex reveals a mixed performance. Over the past week, Paragon Finance outperformed the benchmark with a 10.85% gain compared to Sensex’s 0.64%. However, over the one-month horizon, the stock declined by 1.38% while the Sensex rose 0.83%. Year-to-date, Paragon Finance marginally gained 0.24%, outperforming the Sensex’s 1.11% loss.
Longer-term returns are more favourable for Paragon Finance, with a 3-year return of 51.44% surpassing the Sensex’s 38.88%, a 5-year return of 139.47% compared to Sensex’s 64.25%, and an impressive 10-year return of 617.05% against the Sensex’s 254.70%. These figures highlight the company’s strong historical growth trajectory despite recent volatility.
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Mojo Score and Rating Update
Despite the recent positive financial trend, Paragon Finance’s overall Mojo Score remains low at 26.0, reflecting ongoing concerns about the company’s fundamentals and market positioning. The Mojo Grade was downgraded from Sell to Strong Sell on 6 August 2025, signalling a cautious stance from analysts and investors alike.
The Market Cap Grade stands at 4, indicating a relatively small market capitalisation and limited liquidity, which may contribute to heightened volatility and risk for investors.
Sector Context and Competitive Positioning
Operating within the NBFC sector, Paragon Finance faces stiff competition from larger, more diversified players with stronger balance sheets and broader product offerings. The sector itself has been under pressure due to tightening regulatory norms and rising credit costs, which have impacted margins across the board.
Paragon’s recent margin expansion and revenue growth are encouraging signs that the company is navigating these challenges effectively, but the reliance on non-operating income and low cash reserves remain areas of concern.
Investor Takeaway
For investors, Paragon Finance presents a mixed picture. The company’s record quarterly profits and improved earnings per share demonstrate operational progress and potential for future growth. However, the downgrade to Strong Sell and the low Mojo Score highlight significant risks, particularly related to liquidity and earnings quality.
Long-term investors may find value in the company’s historical outperformance relative to the Sensex, but should remain vigilant about the company’s cash position and the sustainability of its income streams.
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Outlook and Conclusion
Paragon Finance’s recent quarterly results mark a positive inflection point in its financial trajectory, with record profits and earnings signalling operational improvements. However, the company’s liquidity constraints and heavy reliance on non-operating income temper enthusiasm and warrant caution.
Investors should weigh the company’s strong historical returns and recent earnings growth against the risks highlighted by its downgraded rating and modest market capitalisation. Continued monitoring of cash flow trends and core profitability will be essential to assess whether Paragon Finance can sustain its positive momentum in a challenging NBFC environment.
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