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ICE Make Refrigeration Ltd.

BSE: 535034 Sector: Engineering
NSE: ICEMAKE ISIN Code: INE520Y01019
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ICE Make Refrigeration Ltd. (ICEMAKE) - Director Report

Company director report

To

The members

Ice make refrigeration limited

Dear members

Your directors have pleasure in presenting the 9th annual report of thecompany together with the audited financial statements for the year ended on march 312018.

1. Financial performance / highlights

The company's financial performance for the year ended on march 31 2018 is highlightedbelow:

( Rs. in lakhs)

Standalone results

Particulars Year ended March 31 2018 Year ended March 31 2017
Gross revenue from operations 12073.36 9682.08
Less: central excise duty / gst 1968.82 929.12
Net revenue from operations 10104.54 8752.96
Add: other incomes 63.30 35.32
Total revenue 10167.84 8788.28
Earnings before interest depreciation tax & amortization 1301.07 1026.99
Less: depreciation and amortization 149.17 160.65
Earnings before interest & tax 1151.90 866.34
Less: finance cost 178.13 126.49
Profit before tax 973.77 739.85
Less: provisions for income tax including deferred tax 310.46 238.06
Profit after tax 663.31 501.79
Profit carried to balance sheet 663.31 501.79
Accumulated balance of profit 1050.06 839.63

2. Financial highlights and state of affairs of the company standalone

For the year ended march 31 2018 the company's total revenue stood at Rs. 10167.84lakhs indicating 15.70% increase from that of march 31 2017.

Earnings before interest depreciation tax and amortization (ebidta) for the year wasincreased from Rs. 1026.99 lakhs and reached to Rs. 1301.07 lakhs indicating increase of26.69 %. This reflects a robust operational performance and ever increasing growth of thecompany.

Further eps also increased from Rs. 4.36 to Rs. 5.18 registering the growth of 18.81 %even after increase in capital during the financial year.

Consolidated

For the year ended march 31 2018 the company's total revenue stood at Rs. 10326.24lakhs which was increased from Rs. 8823.57 lakhs in march 31 2017 indicating 17.03 %increase.

Earnings before interest depreciation tax and amortization (ebidta) for the year wasincreased from Rs. 1031.30 lakhs and reached to Rs. 1319.63 lakhs indicating increase of27.96 %. This reflects a well management and growth starting right after second financialyear after the acquisition of our wholly owned subsidiary viz. Bharat refrigerationsprivate limited. Further eps also increased from Rs. 4.34 to Rs. 5.18 registering thegrowth of 19.35 % even after increase in capital during the financial year.

3. Dividend:

Considering the profit growth and future prospects of the company the directors havedecided to recommend the final dividend of Rs. 1.00 (10 % on the face value of the share)per equity shares on 15672000 equity shares of the company of Rs. 10/- each for thefinancial year ended on march 31 2018.

The total amount of dividend recommended is Rs. 15672000.

4. Listing on nse emerge

During the financial year under report the company came out with an sme ipo andcompany's equity shares were listed on sme platform of national stock exchange of indialimited (nse emerge) with effect from december 8 2017.

Initial and annual listing fees has been duly paid by the company to the exchange.

5. Details in respect of adequacy of internal financial control with reference to thefinancial statements

The company has in place adequate internal control systems commensurate with the sizeof its operations. The internal control systems comprising of policies and proceduresare designed to ensure sound management of your company's operations safekeeping of itsassets optimal utilization of resources reliability of its financial information andcompliance. Clearly defined roles and responsibilities have been institutionalized.Systems and procedures are periodically reviewed to keep pace with the growing size andcomplexity of your company's operations.

6. Details of subsidiary / joint venture / associate companies

Bharat refrigerations private limited is wholly owned subsidiary company of ice makerefrigeration limited. A statement containing the salient feature of the financialstatement of subsidiary company under the first proviso to sub-section (3) of section 129in form aoc - 1 is appended as annexure - 6

The company is not having any other joint venture or associate company.

7. Material changes and commitment if any affecting the financial position of thecompany

No material changes and commitments affecting the financial position of the companyoccurred between the end of the financial year to which these financial statements relateand on the date of this report.

Further during the financial year under report no significant or material orders havebeen passed by any of the regulators or courts or tribunals impacting the going concernstatus and operations of the company in future.

8. Deposits

During the financial year under report your company has not accepted any depositswithin the meaning of sections 73 of the companies act 2013.

9. Statutory auditors

M/s. Patel & jesalpura (frn: 120802w) chartered accountants ahmedabad wereappointed as statutory auditors of the company at the 5th annual generalmeeting until conclusion of 10th annual general meeting of the company.

In accordance with the provisions of section 139 of the companies act 2013 & rulesframed there under the board recommends the members to ratify their appointment up to theconclusion of next annual general meeting by way of passing ordinary resolution.

The auditors' report (standalone & consolidated) for the financial year ended onmarch 31 2018 forms part of this annual report and the same does not contain anyqualification reservation or adverse remark.

There have been no instances of fraud reported by the auditors under section 143(12) ofthe companies act 2013.

10. Secretarial auditor

In terms of section 204 of the companies act 2013 the board of directors of yourcompany has appointed m/s. K. Jatin & co. practicing company secretaries ahmedabadas a secretarial auditors to conduct an audit of secretarial records and compliances inaccordance with the provisions of section 204 of the companies act 2013 for the financialyear ended on march 31 2018. The secretarial audit report given by m/s. K. Jatin &co. practicing company secretaries ahmedabad is enclosed herewith as annexure - 4.

11. Cost auditor

The board of directors of your company has appointed mr. Mitesh prajapati proprietorof the firm m/s. M.i. Prajapati & associates cost accountants ahmedabad as costauditors to conduct audit of the cost records for financial year to be ended on march 312019.

12. Share capital

During the financial year under report the company came out with an initial publicoffer of 4160000 equity shares of the face value of Rs. 10 each at an issue price of Rs.57/- per share. Your directors are pleased to inform that the company attracted recordhigh sme ipo subscription of over 261 times worth over Rs. 6100 crores against the issuesize of Rs. 23.712 crores.

The company's equity shares are listed on sme platform of national stock exchange ofindia limited (nse emerge) with effect from december 8 2017. Details of increase in thecapital

( Rs. in lakhs)
Particulars Equity share capital
1 existing share capital at the beginning of the financial year (as on april 1 2017) 71.95
2 issue and allotment of shares consequent upon issue of bonus shares (june 29 2017) 43.17
3 issue and allotment of shares consequent upon initial public offer (december 6 2017) (listed w.e.f. December 8 2017) 41.60
Total 156.72

13. Directors & key managerial personnel executive directors

During the financial year under report mr. Chandrakant p patel was designated /appointed as chairman & managing director and mr. Rajendra p. Patel & mr. Vipul i.Patel were designated / appointed as joint managing directors of the company with effectfrom september 5 2017 for a period of 3 years.

Their brief profile forms part of the management profile section of this annual report.

Independent directors

Further the company has appointed ms. Darsha r. Kikani dr. Hasmukh b. Patel mr.Harshardrai p pandya and mr. Krishnakant l. Patel as independent directors with effectfrom september 5 2017.

Their brief profile forms part of the management profile section of this annual report.

Independent directors have submitted the declaration of independence as requiredpursuant to the provisions of section 149(7) of the companies act 2013 stating that theymeet the criteria of independence as provided under section 149(6).

A separate meeting of independent directors of the company was held on february 102018 in accordance with the provisions of clause vii of the schedule iv of the companiesact 2013.

Company secretary & compliance officer

The company has appointed mr. Purvesh pandit as company secretary & complianceofficer of the company with effect from august 11 2017.

Mr. Purvesh pandit aged 24 years is company secretary & compliance officer of ourcompany. He heads secretarial and compliance departments of our company. He is a qualifiedcompany secretary from the institute of company secretaries of india. He also holds adegree in master of commerce and bachelor of law from gujarat university. He has over 3years of post-qualification experience in the fields of secretarial compliance legalcompliance corporate governance and corporate restructuring with listed companies.

Chief financial officer

The company has appointed mr. Ankit patel as chief

Financial officer of the company with effect from september 5 2017.

Mr. Ankit patel aged 30 years is chief financial officer of our company. He heads theaccounts and financial reporting channels of our company. He is a qualified charteredaccountant from institute of chartered accountant of india. He holds a degree in bachelorof commerce from gujarat university. He has over 8 years of work experience in field ofaccounts finance taxation and audit.

Retirement by rotation

In accordance with the provisions of section 152(6) of the companies act 2013 and thearticles of association of the company mr. Vipul i. Patel will retire by rotation at thisannual general meeting of the company and being eligible offers himself forreappointment. The board recommends his appointment.

In this connection it is clarified that as per the articles of association of thecompany the managing directors and whole time directors are not liable to retire byrotation unless otherwise decided by the board. Since there are only 3 non independentdirectors out of whom one is chairman & managing director and other two are jointmanaging directors to comply with the provisions of section 152(6) of the said act boththe joint managing directors who are otherwise non rotational directors have consented tobe liable to retire by rotation and the board has decided that mr. Vipul i. Patel wouldretire by rotation.

I. Evaluation of the board's performance:

During the financial year under report exercise of evaluation was carried out througha structured evaluation process covering various aspects of the board's functioning suchas composition of the board & committee(s) experience & competencies performanceof specific duties & obligations governance etc.

Separate exercise was carried out to evaluate the performance of each individualdirector including the board's chairman who were evaluated on parameters such asattendance contribution at the

Meetings and otherwise independent judgments safeguarding of minority shareholders'interest etc. The evaluation of the independent directors was carried out by the entireboard excluding independent directors and that of the chairman and the non independentdirectors was carried out by the independent directors.

The directors were satisfied with the evaluation results which reflected the overallengagement of the board and its committees with the company. This may be considered as astatement under provisions of section 134(3)(p) of the companies act 2013 and rule 8(4)of the companies (accounts) rules 2014.

The board of your company is composed with proper number of executive and non -executive directors.

Ii. Remuneration policy:

The company follows a policy on remuneration of directors and senior managementemployees. The policy has been approved by the nomination & remuneration committee andthe board. More details on the same have been given in the corporate governance report.

The policy on remuneration of directors key managerial personnel and senior employeescan be accessed on website of the company at following web link:

Http://www.icemakeindia.com/pdf/policies/policy-

On-remuneration-of-directors-key-managerial-

Personnel-and-senior-employees.pdf

14. Number of meetings of board of directors

The board of directors met 14 times during the financial year ended on march 31 2018.The details of the board meetings and the attendance of the directors are provided in thecorporate governance report.

15. Related party transaction

All the related party transactions during the period under report were entered on arm'slength basis in ordinary course of business and in compliance with the applicableprovisions of the companies act 2013 and relevant regulations of the sebi (listingobligations and disclosure requirements) regulations 2015.

There were no materially significant related party transactions made by the companywith promoters directors or key managerial personnel etc. Which may have potentialconflict with the interest of the company at large.

All the related party transactions are presented to the audit committee and the board.Necessary approval has been obtained from audit committee board of directors

And members for the transactions with the related parties.

The policy on related party transactions as approved by the board has been uploaded onthe company's website at the following web link:

Http://www.icemakeindia.com/pdf/policies/policy-on-

Related-party-transaction.pdf

16. Establishment of vigil mechanism / whistle blower policy for directors andemployees

The company promotes ethical behaviour in all its business activities and has put inplace a mechanism wherein the employees are free to report illegal or unethical behaviouractual or suspected fraud or violation of the company's codes of conduct or corporategovernance policies or any improper activity to the chairman of the audit committee of thecompany or chairman of the board. The whistle blower policy has been duly communicatedwithin the company.

Under the whistle blower policy the confidentiality of those reporting violation(s) isprotected and they are not subject to any discriminatory practices. No personnel have beendenied access to the audit committee in this regard.

The said vigil mechanism / whistle blower policy has been uploaded on website of thecompany and can be accessed at following web link:

Http://www.icemakeindia.com/pdf/policies/whistle-

Blower-policy-and-vigil-mechanism.pdf

17. Audit committee

The board has constituted an audit committee which comprises of dr. Hasmukh b. Patel asthe chairman and mr. Harshadrai p pandya & mr. Chandrakant p patel as members.

Further all the recommendations were accepted by the board of directors during theperiod under report. More details on the committee are given in the corporate governancereport.

18. Nomination and remuneration committee

The board has constituted a nomination and remuneration committee which comprises ofms. Darsha r. Kikani as a chairperson and dr. Hasmukh b. Patel & mr. Krishnakant l.Patel as members.

The policy required to be formulated by the nomination and remuneration committeeunder section 178(3) of the companies act 2013 is uploaded on the company's website atthe web link:

Http://www.icemakeindia.com/pdf/policies/policy-on-

Remuneration-of-directors-key-managerial-personnel-

And-senior-employees.pdf

More details on the committee have been given in the corporate governance report.

19. Stakeholder relationship committee

The board has constituted a stakeholder relationship committee which comprises of mr.Harshadrai p pandya as the chairman and mr. Krishnakant l. Patel mr. Rajendra p. Patel& mr. Vipul i. Patel as members.

More details on the committee have been given in the corporate governance report.

20. Sexual harassment of women at workplace (prevention prohibition and redressal)act 2013

The company has in place a prevention of sexual harassment policy in line with therequirements of the sexual harassment of women at workplace (prevention prohibition &redressal) act 2013.

Complaints committee has been set up to redress complaints received regarding sexualharassment. All employees (permanent contractual temporary trainees) are covered underthis policy. We have not received any sexual harassment complaints during the year endedon march 31 2018.

A policy adopted by the company for prevention of sexual harassment is available on itswebsite at the following web link:

Http://www.icemakeindia.com/pdf/policies/policy-

On-prevention-of-sexual-harassment-of-women-at-

Workplace.pdf

21. Loans guarantees or investments under section 186 of the companies act 2013

The company did not grant / make any loan / investment and provide guarantees inrespect of loans availed by others under the provisions of section 186 of the companiesact 2013 and rules framed there under during the financial year under report.

22. Managerial remuneration

The company follows a policy on remuneration of directors key managerial personnel andsenior management employees. The company has paid remuneration to the executive directorsas well as sitting fees to the non-executive directors during the financial year underreport.

More details on the managerial remuneration have been given in the corporate governancereport.

23. Management discussion & analysis report

A detailed analysis of the company's performance is made in the management discussionand analysis report which forms part of this annual report.

24. Corporate governance

During the financial year under report pursuant to the sebi (listing obligations anddisclosures requirement)

Regulations 2015 the company has complied with applicable provision of corporategovernance and a separate report of corporate governance is included as a part of annualreport along with requisite certificate from m/s. Kashyap r. Mehta & associatespracticing company secretaries confirming compliance with the conditions of corporategovernance.'

25. Disclaimer

Though the applicability and adherence of provisions of regulations relating tocorporate governance under the sebi (listing obligations and disclosure requirements)regulations 2015 being not mandated under the provisions of regulation 15 of the sebi(listing obligations and disclosure requirements) regulations 2015 for the listed entitywhich has listed its specified securities on the sme exchange the board of directors ofyour company has still made sufficient efforts to comply with the provisions related tocorporate governance and to disclose the relevant information in the directors' reportcorporate governance report and in the entire annual report to the extent possible as amatter of prudence and good governance.

26. Code of conduct

The board has laid down a code of conduct ("code") for the board membersmanagerial personnel and for senior management employees of the company. This code hasbeen posted on the company's website at http:// www.icemakeindia.com/policies-disclosure.html. All the board members and senior management personnel have affirmed compliance with thiscode. A declaration signed by the managing director to this effect forms part of thecorporate governance report.

The board has also laid down a code of conduct for the independent directors pursuantto the provisions of section 149(8) and schedule iv to the companies act 2013 via termsand conditions for appointment of independent directors which is a guide to theprofessional conduct for independent directors and has been uploaded on the website of thecompany at following web link: http://www.icemakeindia.com/policies-disclosure.html

27. Risk management policy

The board of directors has developed and implemented a risk management policy for thecompany.

It has identified and assessed internal and external risks with potential impact andlikelihood that may impact the company in achieving its strategic objectives.

There is no such risk which in the opinion of the board which may threaten theexistence of the company.

The policy lays down the procedures for risk

Identification description evaluation estimation reporting and development ofaction plan. The policy includes identification of elements of risks which mainly coversstrategic risk operational risk financial risk and hazardous risks. The same can beaccessed from the website of the company at following web link: http://www.icemakeindia.com/pdf/policies/policy-on-risk-management.pdf

More details on the risk and concern factors have been given in the managementdiscussion & analysis report.

28. Corporate social responsibility

The company has attracted criteria for corporate social responsibility (csr) bycrossing net profit beyond Rs. 5 crores (in the financial year ended on march 31 2017)pursuant to the provisions of section 135 of the companies act 2013 including rulesframed there under.

The company has formulated the corporate social responsibility committee and itcomprises of mr. Rajendra p. Patel as chairman of the committee and mr. Vipul i. Patel& mr. Krishnakant l. Patel as members.

In compliance with the requirements of section 135 of the companies act 2013 thecompany has laid down a csr policy. The same can be accessed from website of the companyat the following web link: http://www.icemakeindia.com/pdf/policies/policy-on-corporate-social-responsibility.pdf the company has contributed Rs. 5.88 lakhs towardscorporate social activities. The contributions in this regard have been also made directlyand also indirectly through trust / institutions in fields like education animal welfarehunger etc.

The annual report on csr during the financial year ended on march 31 2018 in theformat prescribed under rule 8(1) of companies (corporate social responsibility policy)rules 2014 is annexed herewith as annexure - 7 forming part of this report.

29. Directors' responsibility statement

In accordance with the provisions of section 134(5) of the companies act 2013 withrespect to the director's responsibility statement it is hereby stated

A. That in the preparation of the annual financial statements for the year ended march31 2018 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;

B. That such accounting policies as mentioned in notes to the financial statements havebeen selected and applied consistently and judgment

And estimates have been made that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company as at march 31 2018 and of the profit ofthe company for the year ended on that date;

C. That proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the companies act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

D. That the annual financial statements for the year ended march 31 2018 have beenprepared on a going concern basis;

E. That proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively;

F. That the system to ensure the compliances with the provisions of all applicable lawswas in place and were adequate and operating effectively.

30. Disclosure u/s 164(2) of the companies act 2013

The company has received the disclosure in form dir-8 from its directors beingappointed or reappointed and has noted that none of the directors are disqualified undersection 164(2) of the companies act 2013 read with rule 14(1) of companies (appointmentand qualification of directors) rules 2014.

31. Conservation of energy technology absorption and foreign exchange earnings andoutgo

The particulars as to conservation of energy technology absorption and foreignexchange earnings and outgo required to be disclosed in terms of section 134 of thecompanies act 2013 & rule 8 of the companies (accounts) rules 2014 have been givenseparately as annexure - 1.

32. Extract of annual return

The extract of annual return in the form mgt-9 is enclosed herewith as annexure - 2.

33. Disclosure as per rule 5 of the companies (appointment and remuneration ofmanagerial personnel) rules 2014

The details as per rule 5(1) & (2) of the aforesaid rule are enclosed herewith asannexure - 3.

34. Certificate on corporate governance

A certificate from practicing company secretary of the company regarding compliance ofconditions of corporate governance as stipulated under the provisions of the sebi (listingobligations and disclosure requirements) regulations 2015 is annexed herewith as annexure- 5.

35. Insurance

The movable and immovable properties of the company including plant and machinery andstocks wherever necessary and to the extent required have been adequately insured againstthe risks of fire riot strike malicious damage etc. As per the consistent policy of thecompany.

36. Environment and safety

The company is conscious of the importance of environmentally clean and safeoperations. The company's policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances of environmental regulations and preservationof natural resources.

37. Gratuity

The company has entered in to an agreement with life insurance corporation of india forcovering its gratuity liability and has thus provided for the same. A gratuity trust fundhas been created with life insurance corporation of india.

38. Disclosure of accounting treatment

In the preparation of the financial statements the company has followed the accountingstandards referred to in section 133 of the companies act 2013. The significantaccounting policies which are consistently applied are set out in the notes to thefinancial statements.

39. Dematerialization of equity shares

The entire shareholding of the company is in demat mode. The isin no. Allotted isine520y01019.

40. Finance

The company's income-tax assessment has been completed up to the assessment year2014-15 and sales tax assessment is completed up to the financial year 2012-2013

The company is enjoying working capital facilities from canara bank. Apart from workingcapital facility the company is having 2 car loans and 1 equipment loan outstanding atthe financial year ended on march 31 2018. The company is generally regular in payment ofinterest and principal.

41. Acknowledgment

Your directors thanks all the stakeholders including investors customers vendorsbankers auditors consultants and advisors for their continued support during the year.We also place on record our appreciation of the contributions of our employees at all thelevels. The management is deeply grateful for the confidence and faith that all thestakeholders have reposed in them. Your directors look forward for their continued supportin the future for the consistent growth of the company.

By order of board
For ice make refrigeration limited
Chandrakant p. Patel
Chairman & managing director
Place: ahmedabad Din:02441116
Date: july 14 2018

Conservation of energy technology absorption and foreign exchange earnings and outgopursuant to the provisions of section 134 of the companies act 2013 read with thecompanies (accounts) rules 2014

[a] conservation of energy

(i) Steps taken or impact on conservation of energy The company is giving high priority to energy conservation and Has continued with its activities of energy analysis and periodic Maintenance and overhauling of the plant and machineries and Use of energy efficient equipments and procedure to the extent Possible.
(ii) Steps taken by the company for utilizing alternate The company has installed solar power panel of 50 kw which
Sources of energy Enables it to use alternate source of energy.
(iii) Capital investment on energy conservation equipments No major investments are planned.

[b] technology absorption

(i) Efforts made towards technology absorption The company has in house r&d department which during the period under review developed a solar cold room. In addition to development of such new products the r&d department is also engaged in improving the efficiency and quality check of company's existing products to ensure that all the company's products meet or exceed customer's expectations.
(ii) Benefits derived like product improvement cost reduction product development or import substitution Work on research & development also gives the company a better image in the market therefore improving the marketability of its products.

(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial

Name / detail of technology imported Year of import Whether it is fully absorbed If not then reasons thereof
1 Roll forming machine 2016-17 Yes -
2 Tagger 320 machine 2016-17 Yes -
3 Panel saw machine - make: felder 2016-17 Yes -
4 Pvc welding machine 2016-17 50% done 50% to be used after designing of new profile for door.

(iv) Expenditure incurred on research and developme Nt Rs. 27.58 lakhs

[c] foreign exchange earnings and outgo

( Rs. in lakhs)

Description Year ended march 31 2018 Year ended march 31 2017
Foreign exchange earned
Sale of finished goods 155.59 11.44
Others 0 0
Total 155.59 11.44
Foreign exchange used (actual outflow)
Import of raw material 396.35 265.20
Import of stores 0 0
Import of capital goods 0 0
Foreign travelling expenses 4.34 3.48
Others 0 0
Total 400.69 268.68

By order of board

For ice make refrigeration limited

Chandrakant p. Patel

Chairman & managing director

Din: 02441116

Place: ahmedabad

Date: july 14 2018