I'm delighted to report another satisfactory year for AIA. We continue to pursue ourfocused strategy and we remain positive about the future opportunities we see.
Underlying our con dent outlook are our strengths: deep domain knowledge in the areasof metallurgy grinding process and part design global foot-print in terms of directengagement with the customer which is supplemented by subsidiaries representative andsales Office and warehouses in key geographies across the world a talent base which isclinically focussed on adding value to customer through innovation across the value chainand a strong balance sheet. Our focus is now on leveraging our knowledge expertise andresources to ensure that we continue to meet customers' needs and deliver the bestpossible products & services to them.
At AIA we understand the importance and criticality of the products we offer to themining cement and power segments. HCMI forms as a small component of grinding cost butit is essential for continuous production. Moreover continuous consumption of the productensures a replacement demand. Our manufacturing capabilities that enable us to produceconsistent quality combined with our service offerings that ensure optimal grindingsolutions and our global footprint have ensured long-standing relationship with customers.
As we go forward we expect a large part of our growth to come from the Mining segment.In a mining plant grinding of mineral ore is generally done in three stages calledprimary secondary and tertiary grinding. The mill internals inside the grinding mills atthese stages are composed of grinding media and mill linings. The overall consumable wearpart demand in mining sector is estimated to be between 2.5 and 3 million MT per annumwith high chrome segment forming less than 20% of the market with the balance being servedby conventional products like forged grinding media. On account of this there exists alarge potential conversion opportunity that can fuel growth for high chrome millinternals. Besides this there is a strong capex being planned by the key major players inthe Copper and Gold mining business which should further help support growth in themarket.
We continue to maintain our market share in the Cement market which remains affected bylower growth. We are seeing some green shoots in some countries like India where Cementcapacity addition is being considered. We will continue to be benefficiary of any capacityaddition in the Cement market globally.
With some capacity addition being done over last few years and more being done as wespeak we believe we are at an in ection point. Our current capacity stands at 340000 MTper annum of high chromium wear parts. We are further pursuing capacity expansions toreach 440000 MT by FY 20-21. Besides we have also planned capex for setting up amanufacturing plant for mill linings for the Mining sector which is expected to becommissioned in FY 20-21.
We will continue to develop solutions in improved wear parts for crushing and grindingequipment and capitalise on the potential opportunity in wear parts in the Mining space.We will focus on building strategic partnerships and benefit from the synergies.
In the longer term we remain excited about the significant structural growthopportunities globally and the potential for further revenue growth margin improvementas well as continued returns to shareholders.
Best Wishes Bhadresh K. Shah
AIA Engineering Limited