Ice Make Refrigeration Limited (ICEMAKE) Earnings Call Transcript & Summary

Good afternoon, ladies in gentlemen. I'm Sagar, the moderator for this conference call. Welcome to the earnings conference call of Ice Make Refrigeration Limited arranged by AARYANA MATASCO to discuss the financial results for Q3 and 9 months FY '25. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Aryan Rana. Thank you and over to you sir.

Thank you, Sagar. Good evening, everyone. Thank you for joining us today for Ice Make Refrigeration Limited's Q3 FY '25 Earnings Conference Call to discuss our financial performance for the quarter ended December 31, 2024. We are pleased to report another strong quarter, driven by our commitment to innovation, operational excellence and a diverse portfolio of over 50 refrigeration products and solutions. Our consistent revenue growth, both quarterly and annually, underscores our strong market presence and expanding sales performance. Notably, our market valuation has [ touched ] nearly 1000x -- 1000% over the past 5 years, reflecting investor confidence and business excellence. Our financial results for the quarter are available on our website and stock exchanges. I would like to remind everyone that today's discussion may include forward-looking statements, which are subject to known or unknown risks and uncertainties that could impact future performance. We encourage you to consider these in conjunction with the risk factors outlined in our disclosures. Joining us today to discuss results and address your questions, we have our esteemed management team, Mr. Chandrakant P. Patel, Chairman and Managing Director; Mr. Nikhil Bhatt, Vice President, Strategy; Mr. Ankit Patel, Chief Financial Officer; and Mr. Mandar Desai, Company Secretary and Compliance Officer. During today's call, we will walk you through our financial performance for the Q3 FY '25, discuss our strategic initiatives, explore market opportunities and share our future outlook. With that, I would now like to invite our Chairman and Managing Director, Mr. Chandrakant P. Patel to take the floor. Sir, over to you. Thank you.

Good evening, everyone. Financial year 2025 [Foreign Language] Thank you.

Thank you, MD sir, and good evening to everyone. I'm pleased to present our financial performance for the third quarter and 9 month period for the fiscal 2025. Our consistent quarter-on-quarter growth reflects our commitment to sustainable expansion, operational efficiency and financial discipline. Some key financial highlights for quarter-on-quarter performance for Q3 FY '25 versus Q3 FY '24. Revenue from operations stood at INR 110.56 crores versus INR 82.43 crores in previous quarter, that demonstrate 34% year-on-year growth. EBITDA in amount stood at INR 6.89 crore versus INR 4.41 crore in previous financial year. In terms of amount, the growth is 56% year-on-year. Quarterly net profit, that is PAT stood at INR 2.81 crores versus INR 2 crores in previous quarter, that amounts to 39% year-on-year growth. Earnings per share, EPS, stood at INR 1.82 versus INR 1.28 of previous corresponding quarters. For 9 months performance of FY '25 and FY '24, out total income stood at INR 299.60 crores versus INR 238.85 crores. That is 25% year-on-year growth. EBITDA stood at INR 21.59 crore versus INR 20.45 crore and that is 5% year-on-year growth. EBITDA margin of 9 months stood at 7.21% versus 8.57% on 9 month basis. Our net profit PAT stood at INR 11.24 crores versus INR 11.86 crores on 9 month comparative basis. That is below -- less by 5% year-on-year. While we witnessed strong top line growth, our net profit for the 9 month period remained moderate due to increased operational costs that is because of continuous panel and commercial freezer plant. Production prerequisites as well as marketing activities and related manpower needs, needs to be organized well in advance. Revenue from operation has just started, as our MD sir has already informed. Till-date, we have achieved INR 9 crores sales in continuous panel plant and more than INR 1.5 crores sales for commercial freezer plant. We are optimistic about contributions of our new plant in coming quarters. And further, we are aiming to achieve EBITDA margin as our suggested targeted range, 9.5% to 10.5% for full year FY '25. Thank you. Now I invite Mr. Nikhil Bhatt for updates on business. Thank you.

Thank you, Ankit ji. Ladies and gentlemen, Ice Make's strong revenue growth highlights our growing market leadership and the sustained demand for our diverse set of refrigeration products and solutions. Our strategic focus on innovation, product diversification and sales channel expansion has been instrumental in driving our consistent performance. Despite inflationary pressures, subdued business environment and global uncertainties, the refrigeration sector has demonstrated remarkable adaptability. By leveraging technology and innovation, the company continues to drive, playing a crucial role in our industry segment growth. At Ice Make, we have successfully navigated these challenges, achieving impressive top line growth. This has been driven by a strong domestic economy and rising consumption trends, stable raw material prices and increased demand across our key verticals, cold room, commercial refrigeration, ammonia refrigeration, transport refrigeration and industrial refrigeration. To sustain this growth momentum, we are focusing on expanding our market reach, that is strengthening our presence in emerging and high-growth sectors, innovation and product development, introducing cutting-edge energy efficient and refrigeration solutions, capacity enhancements, scaling up production to meet the growing demand, leveraging government incentives, utilizing policies that support infrastructure development, credit and sustainable manufacturing. With this strategic initiative, we are confident in exceeding our revenue milestone in the upcoming fiscal years and paving the way for further expansion. Looking ahead, we remain optimistic about our sector's potential to drive economic progress, generate employment and establish India as a global manufacturing and innovation hub. Coming to the growth and opportunity in e-commerce or say quick commerce business, last year, we have received INR 11.5 crores of business from the leading brand, which is operating as a quick commerce business. In the current financial, it reached up to the INR 45 crores of business we have generated till January. So we are optimistic for the quick commerce business. And as our MD sir says that we are confident to achieve this INR 500 crores of milestone in current financial year. Thank you for your continued support, and now we look forward for your questions.

[Operator Instructions] Our first question comes from the line of Arnav Sakhuja from Ambit.

I just wanted to know, could you please give an update on the current CapEx plan? I think earlier we were considering investing around INR 100 crores in the continuous PUF panel factory. So what is the status on that?

[Foreign Language] Can you just repeat your question? [Foreign Language]

Yes, sure. Could you please give an update on your CapEx plans? So, I think in the last call, you have mentioned that you will be considering around INR 100 crore CapEx on a continuous PUF panel factory, so what is the status on that?

I think so far, we have invested INR 100 crores of, as you rightly said, in the CapEx, right. And going forward, we are having a CapEx plan of about INR 150 crores plus. But as of now, our first target is -- the goal is to stabilize these 2 product business and then we will review in the next financial year, let's say, April or May, and we'll decide further to expand the other plant.

Okay. Sure. And would this CapEx -- could it be funded by internal accruals or through debt or through some other method?

New CapEx you are talking about?

Yes, the new one.

Okay. Currently, we have not finalized what will be the mode of new CapEx sources, but it is still very open. We are also looking for the cash flow generation of our -- just to finalize CapEx of our continuous panel and commercial filters. How the cash flow and business support, according to after 2 to 3 months or maybe after the current financial year-end, we will review it. And maybe within 2 to 3 months, we will take up a call how we should go for a second phase of CapEx.

Next question comes from the line of [ Razaki Nasir ], an Individual Investor.

Sir, Congrats on the strong...

Sorry to interrupt [ Razaki ] sir, you're sounding muffled. If you're using speakerphone, may we request you to use handset please.

Yes. sir. [Foreign Language] commercial innovative products for retail, how has that taken off sir? Because I think that has happened in the past 3 to 4 months.

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Yes sir. Please go ahead. I had to mute the line for [ Razaki ] sir. there is an echo from his line.

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The next question from the line of [ Dhananjay Kumar Yadav ].

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[Operator Instructions] The next question comes from Tej Patel from Niveshaay.

Congratulation for your new CapEx. [Foreign Language]

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Okay. And commercial?

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[Foreign Language] PUF panel and commercial at full utilization?

Full utilization [Foreign Language]

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[Foreign Language] almost let's say close to 1% [ we had lost ] purely because of this [Foreign Language]

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[Foreign Language]. Is my understand correct? [Foreign Language]

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[Foreign Language] Is my understanding correct?

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Actually U.S certification is at the final stage. [Foreign Language] It is likely that we may receive the certification totally I think by end of this current financial year. So, it will help to export our product to the U.S. market.

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By end of the Q1 of next financial, I think it would be ready for the [ City ].

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No, no, that is in process. [Foreign Language]

Next question comes from the line of [ Shane D'silva ], Individual Investor.

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[Foreign Language] what will be order growth in this new verticals compared to the old vertical?

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[Foreign Language] So, going by that guidance for the Q4 quarter, you have to have EBITDA around 14%. So, do you think that, that EBITDA margin is sustainable? [Foreign Language]

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The next question comes from the line of [ Parthasarathy Ramaswamy ], an Investor.

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See, actually our Q4 is always in top. [Foreign Language]

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[Foreign Language] very confident that you will be able to match this INR 500 crores and you'll be able to come with a margin of 9.5%, 10% overall [Foreign Language].

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The next question comes from the line of Deepti Jain from [indiscernible].

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The next question comes from the line of Tej Patel from Niveshaay.

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[Operator Instructions] The next question comes from the line of Mosam Shah from Wealthguardian.

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[Operator Instructions] Next follow-up question comes from Tej Patel from Niveshaay.

[Foreign Language] Can this segment become a big chunk of your revenue going forward? [Foreign Language] Can this become a very good chunk of your revenue going forward.

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Sorry to interrupt sir. Sir, the line from Mr. Tej Patel has been dropped. That's the reason we were able to hear the engaged tone. So I had to mute his line, because there is an engaged tone. So, we'll move on to the next question sir. We have our next question coming from the line of Ms. Swati Madhwani from Madhwani Wealth Solutions LLP.

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Ladies and gentlemen, the next question comes from the line of Resha Mehta from GreenEdge Wealth.

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Right, and depreciation?

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INR 7 crores?

Yes.

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Right. But at the PAT level, [Foreign Language]

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Next question is from Mosam Shah from Wealthguardian.

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Next question is from [ Vijay Chuk ] who is an Individual Investor.

Sir, I would like to know what are the short-term borrowing numbers at the moment?

Right now [Foreign Language] working capital utilization [Foreign Language] INR 35 crores.

Short term?

Fund -- yes, short term, working capital.

Okay. So previously, it was actually INR 2 crores, INR 3 crores, INR 5 crores. Now it has increased to probably to INR 35 crores.

No, no, it was not INR 2 crores, INR 3 crores previously also. [Foreign Language]

Okay. And are we still getting any advance from customers?

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So the entire product line is of the same basis, like 5% to 10% on the delivery and the rest is on the advance, you mean to say?

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Next question is from Tej Patel from Niveshaay.

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[Foreign Language] We will maintain about let's say 9% margin, even on that fixed cost. But going forward, let's say [Foreign Language].

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We'll take that as the last question. I would now like to hand the conference over to Mr. Mandar Desai for closing comments.

Ice Make Refrigeration continues its strong growth trajectory, driven by strategic execution, innovation and market expansion. While navigating cost pressures, we remain focused on profitability and long-term value creation. With a robust demand outlook, we are confident in achieving our growth targets and further strengthening our industry leadership. On behalf of Board of Directors and management team, I extend our heartfelt gratitude to our shareholders, employees and partners for their unwavering support. We remain committed to delivering sustained value and look forward to continued strong performance in the coming quarters. If you have any questions or require further information, please feel free to reach out to us or our Investor Relations advisers. We are here to assist you. Thank you.

Thank you very much. On behalf of Ice Make Refrigeration Limited, that concludes this conference. Thank you for joining us. Ladies and gentlemen, you may now disconnect your lines.