Ice Make Refrigeration Limited — Q2 FY26 earnings call

Call held 18 Nov 2025

Management summary

Ice Make Refrigeration reported strong Q2 FY26 results with consolidated revenue growing 43% YoY to ₹147.49 crores and EBITDA margin improving to 6.59%. Profit after tax turned positive, reaching ₹2.02 crores. The company maintains a robust order book of ₹190 crores and is focused on strategic growth initiatives, including a new CEO appointment and planned capacity expansion, despite acknowledging short-term pressures on gross margin and working capital.

Highlights

  • Consolidated revenue from operations stood at ₹147.49 crores, a 43% year-on-year growth and 32% quarter-on-quarter.

  • Consolidated EBITDA margin improved to 6.59% in Q2 FY26, mainly due to increasing scale of operations.

  • Consolidated Profit after tax stood at ₹2.02 crores, improved from loss of ₹1.47 crores in previous Q1 FY26.

  • The current order book is close to ₹190 crore.

  • New CEO, Mr. Srinivas Reddy, appointed to lead development speed and strengthen self-service and cold-room business.

Concerns

  • Gross margin declined around 2% due to higher contribution from continuous panel and quick commerce/corporate customers.

  • Working capital has seen a slight stretch in H1 FY26 due to strategic inventory build-up (compressors, raw materials).

  • ROCE will be under pressure during the CAPEX phase and until new plants reach optimum utilization.

Key financials

  1. Consolidated Revenue ₹147.49 Cr +43%YoY
  2. Consolidated EBITDA ₹9.7 Cr +114%QoQ
  3. Consolidated EBITDA Margin 6.6%
  4. Consolidated PAT ₹2.02 Cr
  5. Standalone Revenue ₹148 Cr +47%YoY
  6. Standalone EBITDA ₹8.78 Cr +97.7%QoQ
  7. Standalone EBITDA Margin 5.9%
  8. Standalone PAT ₹1.45 Cr

What they filed

Q1 FY27: revenue up 60.4%, net profit down 12.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue103 111 180 112 147 +43%153 +39%256 +42%179 +60%
EBITDA8 7 21 4 10 +14%10 +48%21 +0%3 −32%
Net profit5 3 12 -1 2 −58%1 −48%10 −13%-2 −13%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Order book

high confidence

Total value

₹190 Cr

as of 2025-09-30 quantified

Execution

On average, it takes around 45 days. It depends on product to product. The bigger the project, it can take more time. It can take three months or six months. It depends on the size of the product. But for smaller products, we can deliver in a week. And on average, in three months, one order can be completed. If we talk about the cold room, it can take up from 45 days to six months.

Composition

Mix 8 products
  • Cold Room 17.4%
  • Commercial and Dairy Vertical 7.9%
  • Industrial Refrigeration 1.6%
  • Refurbished Transport Refrigeration 2.6%
  • Ammonia Vertical 27.4%
  • Continuous Panel 18.4%
  • Chest Freezer Division 0.5%
  • Project Orders 23.7%

Share of order book by product

The order book is strong and ongoing, with new orders continuously coming in and older ones being closed.

Source: Prepared remarks

Capital allocation

medium confidence
  • Capex Capex disclosed
    • Land acquisition for Phase II CAPEX ₹10.5 Cr
    Madam, the CAPEX that you are seeing right now, the CAPEX of Bharat that did not come in the last full financial year, there is a part of in it. And secondly, there is also an inclusion of the second phase of CAPEX. In this, we have purchased adjoining land. ... Around Rs. 10.5 crores is the land.
  • Debt Debt disclosed
    There is still a little space in debt. And the rest can be done through equity mode. We are open for equity mode. We have not crystallized it yet. That also depends on how our progress is going on. Once this is final, then equity mode will also be there.

Guidance & targets

Revenue

  • FY26 Revenue Revenue · FY26 · High confidence ₹650 crores
    Yes, we are confident that we will achieve Rs. 650 crores.

    — Chandrakant P. Patel

  • Long-term Revenue Revenue · FY27-28 · High confidence ₹1000 crores
    We are committed to our long-term target of top line Rs. 1000 crores by FY'27-28.

    — Chandrakant P. Patel

Margin

  • FY26 EBITDA Margin Margin · FY26 · High confidence 8%

    Previously 8-9% → 8%

    And EBITDA, we will improve it to 8% because if the base of our second half is big, then the operation cost will get a scale benefit. So, we will do 8% minimum.

    — Chandrakant P. Patel

  • Product Price Increase Margin Benefit Margin · entire year · High confidence 1%
    We will increase our product price step by step, which will give us a 1% margin benefit for the entire year.

    — Chandrakant P. Patel

ROCE

  • Long-term ROCE ROCE · over a period of time · Medium confidence 20-25%
    So, our benchmark, which we internally discuss in the projection, so, around 25% ROCE we should maintain over a period of time.

    — Management

Capex

  • H2 FY26 CAPEX Capex · H2 FY26 · Medium confidence ₹3-5 crores, potentially up to ₹15 crores
    In H2, it will not be much. There will be a little bit of Bharat Refrigeration. Now, there is development in the second phase of CAPEX. It may come around Rs. 3 crore, Rs. 4 crore, Rs. 5 crores. But there will not be much improvement in this financial year. If there is any development in this financial year, then it may go up to Rs. 15 crores. If there is any development.

    — Management

What to watch in Q3 FY26

FY26 Revenue Target Achievement

FY26
Current ₹147.49 crores (Consolidated Q2 FY26)
Target ₹650 crores

Why it matters

Key indicator of overall business growth and execution against guidance.

Yes, we are confident that we will achieve Rs. 650 crores.

Risks & concerns

  • Working capital stretch

    medium

    Slight stretch in working capital due to strategic inventory build-up, but expected to improve in H2 FY26.

    Both acknowledged

  • ROCE pressure during CAPEX phase

    medium

    ROCE will be under pressure during the CAPEX phase and until new plants reach optimum utilization.

    Management acknowledged

  • Gross margin decline

    low

    Around 2% gross margin decline due to sales mix (continuous panel, quick commerce), expected to normalize.

    Both acknowledged

Q&A highlights

7 direct
FY26 Revenue and EBITDA Margin Guidance Direct
Yes, we are confident that we will achieve Rs. 650 crores. Because generally, our first half, second half ratio is 40:60. Accordingly, we will Rs. 650 crores. And EBITDA, we will improve it to 8% because if the base of our second half is big, then the operation cost will get a scale benefit. So, we will do 8% minimum.

Confirms and clarifies the company's full-year revenue and profitability targets, explaining the seasonal business mix.

Asked by Arnav

1% Margin Improvement from Price Increases Direct
No, we will be at 8% with that 1%. You also saw that in the first and second quarters, our EBITDA was less. And in the last two, three years, we did not revise the price of many products due to our aggressive top-line growth. So, after increasing that 1%, we will reach to 8%.

Explains the strategy behind the targeted margin improvement and its contribution to the overall EBITDA goal.

Asked by Arnav

Update on Rs. 150 crore CAPEX Partial
That is in dialogue phase. Discussion is going on that. One it gets finalized then only we will be able to give a concrete answer. For now it is positive and in progressive stage and it is improving in a positive way and as it comes to a finalization base we will announce and share the data with you all.

Provides an update on a significant future capital expenditure, indicating it's progressing but not yet finalized.

Asked by Arnav

H1 FY26 CAPEX and Funding for Phase II Direct
Madam, the CAPEX that you are seeing right now, the CAPEX of Bharat that did not come in the last full financial year, there is a part of in it. And secondly, there is also an inclusion of the second phase of CAPEX. In this, we have purchased adjoining land. ... There is still a little space in debt. And the rest can be done through equity mode. We are open for equity mode.

Clarifies the nature of H1 CAPEX and outlines the potential funding strategy for the large Phase II CAPEX, addressing concerns about the debt-to-equity ratio.

Asked by Resham Mehta

Working Capital Stretch and Improvement Direct
Madam, as of now, there has been a slight stretch in working capital. We used to use compressors in import, raw materials, there were BIS issues in that. So, in advance we imported compressors and raw materials in specific chest freezer. And we have also increased the inventory level a little bit, strategically. ... But in the current working capital, there will be a drastic improvement. Because the major business is in our second half.

Explains the reasons for the current working capital situation and provides a clear expectation for improvement in the second half of the fiscal year.

Asked by Resham Mehta

ROCE Targets and Pressure during CAPEX Direct
So, our benchmark, which we internally discuss in the projection, so, around 25% ROCE we should maintain over a period of time. ... But when we come to the growth or CAPEX phase, so, the immediate, the new plant, its contribution to revenue and profit does not start. ... So, in the CAPEX phase, there will always be pressure on ROCE.

Sets long-term ROCE targets but candidly acknowledges the short-term pressure during periods of significant capital expenditure and capacity ramp-up.

Asked by Resham Mehta

Gross Margin Decline and New Verticals EBITDA Direct
Our quick commerce business and overall corporate customers business, that percentage has increased. So, it is stable. Our margin profile is slightly up and down based on the overall sales mix. But there will not be any major change or deviation in that. It will be back to normal based on the sales mix and the corporate and retail mix will change. ... We have just started in the new business. It is difficult to calculate EBITDA vertical wise as of now. But in this financial year, it will be in the break-even position and EBITDA margin will also be in the positive improvement stage.

Addresses concerns about margin pressure and provides clarity on the profitability trajectory of new business segments.

Asked by Arjun Mali

Order Book Composition and Delivery Timeline Direct
So our order book is Rs. 190 crores. Vertically speaking, the cold room is around Rs. 33 crores. ... On average, it takes around 45 days. It depends on product to product. The bigger the project, it can take more time. It can take three months or six months.

Provides a detailed breakdown of the current order book by product segment and clarifies the typical execution timelines, offering visibility into future revenue recognition.

Asked by Mausam Shah

3 min read 7 chapters

Detailed narrative

Q2 FY26 Financial Performance Overview

Ice Make Refrigeration reported a strong Q2 FY26, with consolidated revenue from operations growing 43% year-on-year and 32% quarter-on-quarter to ₹147.49 crores. Consolidated EBITDA improved significantly to ₹9.70 crores, resulting in an EBITDA margin of 6.59%, up from 3.08% in Q1 FY26. The company also turned profitable, posting a consolidated Profit After Tax of ₹2.02 crores, a substantial improvement from a loss of ₹1.47 crores in the previous quarter, primarily driven by increased scale of operations and better capacity utilization.

Strategic Growth Initiatives and Leadership

The company announced the appointment of Mr. Srinivas Reddy as the new CEO, bringing experience from Blue Star Limited to strengthen the self-service and cold-room businesses and accelerate development. Management is actively focusing on growing service business revenue and expects a 1% margin benefit for the entire year from gradual product price increases, which have not been revised in the past 2-3 years due to aggressive top-line growth.

Robust Order Book and Execution Visibility

Ice Make Refrigeration maintains a healthy order book of approximately ₹190 crores as of September 30, 2025. This includes significant contributions from the ammonia vertical (₹52 crores), continuous panels (₹35 crores), and project orders (₹45 crores). The average delivery timeline for orders ranges from 45 days to 3 months, with larger projects potentially taking 3-6 months, providing good revenue visibility for the coming quarters.

Capital Expenditure and Funding Plans

In H1 FY26, the company incurred CAPEX of ₹22 crores, which included ₹10.5 crores for land acquisition related to the planned ₹150 crore Phase II CAPEX. This larger expansion project is currently in the 'dialogue phase' and is progressing positively. Management indicated that funding for this significant CAPEX would involve a mix of available debt capacity and equity, acknowledging that the current debt-to-equity ratio is above 1.

Profitability and Working Capital Management

While the gross margin saw a slight decline of approximately 2% in Q2 FY26, attributed to a higher contribution from continuous panels and quick commerce/corporate customers, management expects this to normalize with the overall sales mix. The company experienced a temporary stretch in working capital due to strategic inventory build-up of compressors and raw materials, but anticipates a 'drastic improvement' in H2 FY26 as business volumes increase significantly in the second half of the fiscal year.

Long-Term Financial Targets and Outlook

Ice Make Refrigeration reiterated its FY26 revenue target of ₹650 crores and an 8% EBITDA margin, expecting the second half to contribute 60% of annual business. The company's long-term vision includes achieving ₹1000 crores in revenue by FY27-28 and maintaining a 20-25% Return on Capital Employed (ROCE). Management acknowledged that ROCE might face short-term pressure during the CAPEX phase until new capacities reach optimum utilization.

Market and Sectoral Demand Trends

The company observed strong traction in cold rooms, refrigeration systems, and industrial cooling units, driven by robust demand from the food processing, dairy, pharma, and healthcare industries. There is positive momentum from 20 projects across India, with increasing enquiries for energy-efficient and eco-friendly refrigeration technologies, strengthening the company's presence in Eastern, Central, and Southern regions.

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