Managing Directors Review
I personally feel that our business is truly charming and it gives me immensesatisfaction to see such a large number of satisfied customers across the Globe beingserviced through a well balanced team and a network of subsidiaries/warehouses atstrategic locations across the Globe.
It gives me immense pleasure to share my views with you through this communication.Since the detailed numbers are a part of the financial statements and more particularlysince the analysis of the performance is also covered at length under the section"Management Discussion and Analysis" as well as a part of the report of theBoard of Directors I would rather take this opportunity to give an overview of our visionand our strategies.
As you are aware our business is to offer unique solutions relating to reduction ofwear rates and improvement of efficiencies relating to grinding and crushing operations inthe Global Cement and Mining industries and also in the Thermal power plant segment inIndia.
Our business focus is essentially on the replacement markets we supply acomprehensive range of consumable parts like Grinding Media Liners Vertical Spindle MillSpare parts etc. which are designed as tailor made solutions for the specific end usersacross the Globe. These wear parts are collectively referred to as MillInternals and we operate entirely in the High chrome category that is to say ourwear parts are Alloys which are cast in our specialised Foundries utilising uniquetechnology and processes where the element of Ferro Chrome is higher than 5% and can goall the way up to even 32%. Our parts are very critical in nature since their nonavailability or failure can lead to the stoppage of the entire grinding or crushingoperations in the end use industry. Again our wear parts are impact and corrosionresistant and we offer the wear parts as a unique solution to a given customer afterstudying the application and then design the wear parts to suit that application with aparticular metallurgy.
I would like to state that we are only a 15 year "young" company and ourindependent journey has begun in 2001 after we separated from our erstwhile Joint VenturePartners.
I am proud and happy to state that in just 15 years of our journey we have come a longway. Your company is now regarded as a truly Global Indian MNC we being present in morethan 125 countries of the world where we are directly in front of the customers that is to say we cannot market our products through the standard distribution channelsbut our team has to be in front of the customers so as to understand their requirementsand design the unique solution for them. Thus our business is very niche businessrequiring tremendous micro management. I personally feel that our business is trulycharming and it gives me immense satisfaction to see such a large number of satisfiedcustomers across the Globe being serviced through a well balanced team and a network ofsubsidiaries/warehouses at strategic locations across the Globe.
As you may be aware the current focus of the company is on the huge opportunityavailable in Mining segment. To elaborate as against the conservative market in the formof annual replacement demand of around 2.5 to 3 million tons the penetration of HighChrome Mill Internals in this segment is not more than 15%. Thus we have a hugeopportunity of conversion of the mines from conventional wear parts to our high chromewear parts. While cost reduction is a very important driver thanks to much lower wear ratethat our parts offer we have also attempted to a significant quality shift viz. our R& D efforts are to establish that apart from the reduction in the cost of wear partswe are able to bring on table a significant reduction in the consumption cost of otherconsumables (over and above the cost of wear parts) improvement in efficiencies andperhaps the most important of all a perceptible improvement in the recoveries of basemetals also. I am happy to share that we have made considerable headway in this directionand going forward we are fully geared to take your company to the next level with a clearvision to become the undisputed Global leader in the High Chrome Mill Internals segment. Iam elated to inform that we have started servicing all major Mines/Mining Groups acrossthe Globe and our developmental efforts are going on in full swing to ensure that weachieve our vision at the earliest.
Needless to add while we will continue to service the Global Cement as well as Indianthermal power plant segments and therefore as and when the growth opportunity in thesesegments arise we will be obviously ready to capitalise upon the same; as of now inforeseeable future our focus will continue to be on capitalising the Global Mining segmentopportunity.
I want to sincerely thank you our shareholders for always standing by us and reposingfull faith and confidence in our endeavour. I look forward to keep on sharing details ofthe companys growth and progress as and when we reach the desired milestones.
I wish you all the very best.
Bhadresh K. Shah
Managing Director AIA Engineering Limited