Company overview

AIA Engineering (NSE: AIAENG), Established in the year 1991, a certified ISO 9001 company, specialises in the design, development, manufacture, installation and servicing of high chromium wear, corrosion and abrasion resistant castings used in the cement, mining and thermal power generation industries.1

Vega Industries is a wholly owned subsidiary of AIA Engineering, exclusively supplying its products, providing customer support and technical services to customers from its offices worldwide.

The company's philosophy is to provide customers with optimized solutions through technical evaluation of their requirements, thereby providing specifically designed solutions in ideal metallurgy for the application, plus offering process optimization services worldwide.

As a result of this approach, the Group is today the leading company for Quality, Services and Innovation in its field with an enviable reputation providing Global Solutions.

A truly global solution to customer's local requirements

AIA engages with customers in more than 120 countries. The Company has a local presence in strategic locations across the world through subsidiaries and rep offices. This has allowed the Company to build long standing relationships with global blue chip customers in cement and mining markets.


AIA Engineering and Vega Industries have become one of the most successful companies in supplying and installing wear components because they really understand how grinding and crushing operations need to work. This expertise is available to customers worldwide and includes the following:2 

  • Mill Audits
  • Turnkey installation and commissioning projects
  • Stock assessment and management
  • Performance monitoring

The company specializes in following business area.

  • Cement
  • Mining
  • Power
  • Aggregate

Business Overview

The Company continues to invest its resources in furthering its market share in the high chrome mill internal market worldwide with specific focus on high growth in the mining sector. To that extent, the future growth prospects of the Company will rely on making further inroads in mining industry.3

The Company focuses on 4 mineral ore types that represent the biggest pie of the mineral grinding space. These are Iron, Platinum, Gold and Copper. Annual replacement requirement of grinding media is estimated at 2.5 million tons. Of this, less than 20% is currently converted to high chrome while the balance is served by forged grinding media. This represents a large potential opportunity to convert forged grinding media to high chrome.

The Company started its engagement with the mining sector by offering grinding media in high chrome metallurgy which reduced wear rates and thereby the cost of these consumables. The Company’s DNA is to work on sharpening this engagement continuously by offering further solutions that improve customers’ operations and reduce their costs. In line with this philosophy, Company now offers solutions that can help in reduction in cost of other consumables (other than high-chrome grinding media), reduction in use of toxic reagents and thereby improving their environmental footprint and increasing metal recovery, especially relevant for gold and copper mines. This has helped the company in being able to provide comprehensive solutions to the mining industry globally and in creating a unique positioning which augurs well for the consistent and steady growth in this industry over medium to long term.

In addition to Grinding Media, Company is now focusing on Mill Linings for the mining customers. The Company has been making these parts for grinding mills for Cement grinding for more than 20 years. It now offers these parts for grinding mills used for mineral ore grinding and offering solutions which can result in optimized grinding efficiency. Company will be able to offer reduced power costs and increased throughputs as a solution to customers. There will be material savings for the customer and with Company’s existing solutions around wear cost reduction, reagent consumption reduction and metal recovery improvement, it will position the Company as true partner with its Customers and help sharpen its engagement meaningfully. Company is in the process of setting up a dedicated Greenfield facility to manufacture Mill Linings which will help it to service this industry.

The Company has consciously made efforts to target multiple ores and spread its presence across all major mining centers like North America, Latin America, Australia, Africa, and Far East Asia, etc. thereby diversifying its risks significantly. On account of this, downturn in any one commodity or political and other issues in any one country will not materially impact the Company. During last few years, the company has steadily increased its presence in the major mining groups across the globe. Given the current lower level of penetration of High Chrome Consumables in the mining segment as against the total requirement which is currently serviced by forged media, the Company has aggressive growth plans so as to capitalise upon the available opportunity in the mining segment and the vision is to emerge as the leading global solution provider in this segment. While the main focus of the Company in mining segment is outside India, the company also has a major share of the domestic mining demand and shall be able to capture incremental demand as and when the same arises.

In spite of a possible near term slow down in wake of the impact of the Covid-19 Pandemic, the company believe that this is likely to be normalised within a relatively shorter period and thus in medium to long term the prospects of mining industry for the company remain unaltered and the company continues to remain bullish on mining industry as its core area of focus.

Cement market continues to remain flat on a global basis as well as in India. The company is happy to inform that it continues to maintain market share and continues to make investments in newalloys, designs and process improvements which will ensure that it continues to be a preferred supplier to Cement Companies worldwide. While in near term, due to Covid 19 impact the Cement demand is impacted, over a medium to longer term, the Company is hopeful of seeing a resurgence of normal demand on the back of overall investment climate post the economic stimulus announced by the Governments of all major countries of the world. On the whole, in near term, the company continues to believe that the overall production and sales will remain flat in this segment.

In the Utility sector (Coal Thermal Power Plants), which is driven largely by the domestic market, the company continues to enjoy a niche position. The Company will strive to maintain a steady growth rate in this particular segment matching with the rate at which the sector grows.


AIAE’s core business involves offering solutions around grinding and crushing operations with focus on wear parts used in these processes at Cement plants, Mines and coal fired Thermal power plants. AIAE’s growth prospects are linked to overall economic conditions in these industries in addition to its strategy around taking higher market share.

AIAE’s primary growth prospects are linked to its strategy for the mining space from which bulk of its growth is expected to accrue from. The growth prospects are primarily emanating out of the large annual replacement market in this industry. Conventionally, forged grinding media is being used for grinding and crushing in grinding mills. Less than 20% of this is converted to high chrome and hence presents an opportunity to AIAE to convert forged media to high chrome. Main benefits of high chrome include reduction in wear cost, reduction in consumption of reagents and down process benefits including higher recovery of metal in gold and copper ore. AIAE engages with a customer over 18 to 24 months to develop a mine site by doing trials and establishing optimal chrome grade for that set of operating conditions. Because of these benefits the company expect high chrome to take higher market share over forged over a time.

Additionally, AIAE is further entrenching itself in the mining space by venturing into Mill Linings wherein the offering will include optimization of grinding circuit. The Company will be able to offer reduced power costs and increased throughput as a solution to customers. These will be material savings for the customer and with Company’s existing solutions around wear cost reduction and down process benefits of increased recovery of metal and reduction in reagent consumption, it will position the Company as a true partner with its Customers and help sharpen its engagement meaningfully in the Mining space.

In spite of a possible near term slow down in the mining industry in wake of the impact of the Covid-19 Pandemic, the company believe that it should normalise within a relatively shorter period and thus in medium to long term the prospects of mining industry, in as much as AIAE is concerned, remain unaltered and AIAE continues to remain bullish on mining industry as its core area of focus. Again, as per the information available with AIAE, despite Lockdown being declared in major countries of the world most of the mines continued to operate, though at lower levels of output. Similarly, the process of developing solutions for both the existing as well as new mines continued without any major disruption. Now therefore as most of the major economies of the world have consciously started unlocking the economic activities AIA Engineering is confident that at best, this near term slow down would represent a minor aberration and will not impact the long term prospects for AIAE in mining segment.

In the Cement segment, the near-term prospects continue to remain flat. As and when India’s cement production will go up the company will be an immediate beneficiary in terms of incremental production going to service the additional requirement. On the global front, most developing and developed markets continue to be marginal growth phase reflecting flat sales for AIAE. In China, the Company currently maintains a limited presence by marketing specific products.

In as much as the thermal power plants are concerned the Company continues to enjoy a niche position in this particular segment in India. The Company will strive to maintain a steady growth rate in this particular segment matching with the rate at which the sector grows.

Capex plan

The company’s current capacity stands at 3,90,000 MT of high chrome mill internals which has increased from 3,40,000 MT after implementation of the first phase of 50,000 MT capacity of Grinding Media GIDC Kerala expansion project. The company is also in the process of setting up of a dedicated Greenfield plant for manufacture of Mill Lining with a capacity of 50,000 TPA whose implementation has commenced in fiscal year 2019-20. The company expects to commission this plant before March 2021. The total estimated capital outlay for the Mill Lining plant is ` 250 crores, out of which the company has already incurred Capex of ` 60.00 crores in FY 2019-20 and the balance Capex of ` 190.00 crores will be incurred in FY 2020-21.

However, in line with various uncertainties emerging on account of Covid-19 Pandemic the company has decided not to break ground on the second phase of the grinding media Brownfield capacity expansion of 50,000 MT at GIDC Kerala, Ahmedabad. The second phase will be most likely deferred to the next fiscal year.

The company plans to fund all the above Capex from internal cash accruals.

Financial Highlight

Standalone Operating Results

During the year ending March 2020, the Revenue from Operations of the Company is Rs 2,58,762.44 Lakhs as compared to Rs 2,83,758.50 Lakhs in the previous Financial Year. Exports Turnover registered in the same period is Rs 1,93,303.97 Lakhs as against the Export Turnover of Rs 2,07,549.52 Lakhs in the previous Financial Year.

During the year ending March 2020 Company has earned a Profit Before Tax (PBT) of Rs 95,741.03 Lakhs and Profit After Tax (PAT) of Rs 83,252.97 Lakhs as compared to PBT of Rs 60,191.41 Lakhs and PAT of Rs 41,482.17 Lakhs respectively in the previous Financial year.

Consolidated Operating Results:

During the year ending March 2020, on a Consolidated basis, the company (together with its Subsidiaries) has earned Revenue from Operations Rs 2,98,087.75 Lakhs as compared to Rs 3,06,949.99 Lakhs in the previous Financial Year. Correspondingly, the Consolidated Profit After Tax (PAT) registered during the year under review is Rs 59,035.80 (After Minority Interest) as compared to PAT (After Minority Interest) of Rs 51,083.05 Lakhs in the previous Financial Year.


The Company has declared an Interim Dividend of Rs 27/- (1350%) per share on 9,43,20,370 Equity Share of the face value of Rs 2/- each amounting to Rs 25,466.50 Lakhs (excluding Dividend Distribution Tax of Rs 4,444.45 lakhs) for the Financial Year 2019-20 on 9th March 2020. The said Interim Dividend was paid on 23rd March 2020. Having declared Interim dividend for the Financial Year, Board has not recommended a Final dividend for the Financial Year 2019-20.


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Created by Asif Farooqui on 2020/10/07 17:33
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