A defence stock involved in the design, development, and maintenance of wireless and satellite communication products, defence electronics, and other solutions for the defence, aerospace, and emerging sectors, saw a surge of up to 13% in daily trading after announcing a 210% quarter-on-quarter (QoQ) rise in net profits for Q2FY25.

Stock Price Movement
Avantel Limited, with a market capitalization of ₹4,578 crores, saw its shares trade at ₹188.20 per share, reflecting a 5.49% increase from the previous day’s closing price of ₹178.40.

Q2FY25 Financial Results
The company's revenue from operations experienced a 43% year-on-year (YoY) increase, climbing from ₹54.33 crores in Q2FY24 to ₹77.42 crores in Q2FY25. Additionally, on a QoQ basis, revenue grew by 50%, rising from ₹51.76 crores in Q1FY25 to ₹77.42 crores in Q2FY25.

Net profit saw a notable rise, increasing by 42% YoY from ₹16.07 crores in Q2FY24 to ₹22.89 crores in Q2FY25. However, the most significant growth was on a QoQ basis, where net profit surged 210%, from ₹7.38 crores in Q1FY25 to ₹22.89 crores in Q2FY25. The net profit margin also showed a slight improvement, increasing from 29.36% in Q2FY24 to 29.39% in Q2FY25.

Segment Performance
Revenue from the Communication and Signal Processing segment saw impressive growth, rising from ₹54.57 crores in Q2FY24 to ₹77.74 crores in Q2FY25, reflecting a 42.45% increase. Additionally, revenue from the healthcare sector increased by 7%, from ₹15.81 lakhs in Q2FY24 to ₹16.95 lakhs in Q2FY25.

About Avantel Limited
Avantel Limited specializes in designing, developing, and maintaining wireless and satellite communication products, defence electronics, radar systems, and network management software for the defence and aerospace sectors. The company’s core business segment, Communication and Signal Processing, encompasses the manufacturing of wireless front-end systems, satellite communication, embedded systems, signal processing, and network management software. Avantel also offers customer support services and operates an in-house R&D facility.

The company serves prominent clients such as the Indian Defence Forces, DRDO, ISRO, and various public sector undertakings (PSUs) like Bharat Electronics Limited and Larsen & Toubro, as well as private sector players such as NewSpace India Limited.

Recent Contracts
In September 2024, Avantel secured several work orders. Notably, it received an order from NewSpace India Limited for the supply, installation, and commissioning of a Ground Segment Hub, valued at ₹9.39 crores. The company also received orders from Bharat Electronics Limited and Larsen & Toubro for the supply of Satcom equipment, valued at ₹3.45 crores and ₹44.49 crores, respectively.