Good afternoon ladies and gentlemen, and welcome to the Q3 result call of AIA Engineering. I'm Sanjay Majmudar, and as usual myself and Kunal, we will be taking this call.

Unfortunately, Kunal is slightly stuck in traffic and he will be joining in the next 2 to 3 minutes. In the interest of the time, I will just as usual give a little overview of the Q3 numbers.

I'm assuming that you all would have a chance to have a look at the numbers. As you will see, in this quarter, we have done around 67,896 tonnes of production and 64,500 tonnes of sales.

Cumulatively, therefore, for the nine months period, this comes to almost 187,000 tonnes of production and almost a similar tonnage of sales. The overall top line in terms of the operating revenue stood at about 1,066 crores, and including other non-operating income, we've reported about 1,200 crores as a top line.

The reported EBITDA is about 425 crores, which comes to almost 40%, and the operating EBITDA is around 28% after knocking off the other non-operating income. We've reported a PAT of about 80 800 we have reported a PAT of about 294 crores after deducting the minority interest.

Correspondingly, for the nine months period, the EBITDA stood at about 1,093 crores and the PAT stood at about 775 crores. Now, if I look at the numbers in retrospect, Kunal has just joined.

Kunal, we were just giving the overview of the numbers for the Q3 and nine months period.

Yes. Good good afternoon, good evening everyone.

I also have a bad throat, you're going to hear more of Sanjay than I have. I hope you will hear of me.

This quarter has been relatively a uneventful period. I think we continue to do more of what we are doing, very little in terms of market or business updates.

I think it looks to be a year when, or rather a period when there is tremendous amount of unstability, around us. Possibly the best course of action is to, fasten one's seat belt and make sure that, we survive this period, and we consolidate ourselves and to make sure that we thrive, with everything else that we're doing.

Just a small correction, the nine months PAT stood at 876 crores and the EBITDA stood at 1,241 crores on a top line of about 3,153 crores and the total income of 3,495 crores. You may continue.

Exactly. For the quarter, we've done about 294 crores PAT and 425 crores of EBITDA.

The numbers, continue to reflect, all the value that we bring to the customers. All of which, forms a basis for, what we're doing for new customers within the, the mining environment, mining customer base.

Moving on, as far as other income is concerned, the total, stood at 135 crores. There is a reasonable amount of foreign exchange gain, as the currency, as we all know, has moved beyond 90.

There's a 50 crores of foreign exchange gain. The rest is standard and customary, there's an 18 crore export benefit, and there's a treasury income of 83 crores, a total of about 135 crores of other income.

We are assuming that foreign exchange and export benefits are operational in the nature that, they'll the next year, the other the foreign exchange gain will move into a revenue line item, assuming, all our invoicing it looks like currency may not appreciate much from here, may continue to slide, as we all know with the Indian rupee vis-a-vis the dollar situation is concerned. That stood at in the that was about 67 crores.

There is a marked increase in other income compared to the third quarter last year. I think everything else continues.

Working capital is at is in line. From volume standpoint, volumes still reflect a little bit of, issues that we've discussed, over this period.

Third quarter is at par with the third quarter last year, and nine months is also similar. We're we're we're absolutely, haven't absolutely similar numbers in both these periods.

We did 187,800 tonnes for nine months, and about 64,500 in this quarter. Otherwise, numbers are comparable within mining and non-mining.

While Sanjay will speak a little more about, how this forms what are the basis and things that we are looking at, broadly, broadly business is as is from everything that we mentioned. Realization is similar, our cash levels continue to be around 4,200 crores, we're not looking at significant capex beyond maintenance and some bits of remaining capex from our casting plant.

One highlight was the fact that we've closed our plants in closed the plant of our subsidiary in Bangalore called Welcast Steels, and that reflected 24,000 tonnes of capacity. We were at 460,000 tonnes, which was 340 of grinding media, 120 of non-grinding media.

The grinding media now stands reduced by 24,000 tonnes. So, 314,000 tonnes and 120 of castings, taking our total capacity from to 436,000 tonnes.

We this year will do at current run rate about 250, 260,000 tonnes. We are still, operating reasonably below full capacity utilization.

Our facilities in Ahmedabad, we can look at more, capacity as brownfield, plus our plans to go build things outside of India as in Ghana and China. With that said, even after the plant even after that capacity going off stream, it looks to be that we are okay as far as serving our customer base and serving our growth needs are concerned.

As far as market is concerned, like I said, just serious amount of uncertainty across the board. Every country is doing, things in its own, trying to protect its own interests.

There is lots of uncertainty around geopolitics, with wars being waged in several regions, something that's going on with Iran right now, the Southeast. Shipping lanes continue to be fragile and, high-wired.

That's also a risk in terms of container availability, shipping line availability, shipping time, and of course the volatility in shipping costs. Having said that, just in just, reflecting back on what are we doing with the customers.

The world is continuing to go put borders, duties, protectionist measures. How does a company like AIA, thrive and grow?

What is the mindset? We are saying that if that is the world that we live in, which is protectionist in nature, how do we look at our strengths, vis-a-vis incumbents or our competition?

One of the facts is that India remains an extraordinary location for our type of products, which is not just production or hands on the factory, but it is the whole value chain, which is design, pattern making, production, customer interfacing, the whole service and metallurgy aspect, and of course our production, I mean the ecosystem that exists in India for these type of products overall. The solutions that we've built on top, give us the confidence that despite what may happen, despite these turbulences that we are seeing on the ground, we all are seeing the serious surge in metals, precious metals, gold and silver, and there is a significant talk about what happens to copper.

We were reading about how the world has mined X amount of copper in last, from till the time humanity came started mining, that amount of copper will be will needed to be mined in next 20 years just to continue a 3% growth rate. There is just unreal amount of stuff happening.

Copper looks to be in a structural bull run. The world will run out of copper in in with the way it's projected to be, and and copper production is reducing in tonnage, standpoint every year, every month, just because of the grade condition.

Looks like we are one of the only game in town addressing this serious problem. We are very excited of all our solution, interface, and engineering that we're doing in terms of solving those issues, solving, those critical challenges for our mining clients, especially gold and copper.

With that said, we have to that does not, absolve us of overcoming these duties and shipping-related issues or the general overall conservatism that we see with our customers in having to try out different solutions. All all we can do is continue to reinforce our efforts, ensure that our solutions become, more and more deeper and bring more value addition to the client, and we're hoping that unlock happens.

We announced our first chrome customer in South America, and and that's the first chrome consumer in the mining space. A lot of people then asked us, will that mean 100,000 tonnes coming up?

I think our guidance will continue to abstain from a guidance. We've explained, that's because of the lack of clear signaling from the customers on what means, liking the product or got getting the proof of concept to moving to full commercial, engagement.

There is a whole lot of steps involved, and we don't want to be in a situation where we go ahead of ourselves. We'll do the work.

We'll see the tonnages coming on, and we'll keep sharing as much as we can, but and share as much about the business, but you will have to pardon us for not being able to share volume guidance at this time. Besides the developments, within the the win that we had last quarter, we do several trials.

We are working on several trials. A lot of Some of Some important trials which were which we were to get trial results of last quarter look to have moved to, this quarter, the March quarter.

That's just the way, things are at mining end. There is just lot of unpredictable, variables that we work with.

Trying to say will will we see clarity in three months, six months, or two years is not also a question that unfortunately we'll be able to help. We are hoping that the the numbers that we have presented, and everything else about the business reflects the kind of effort that we're making to bring value.

That's, I think, the singular mission of our work where there is disproportionate value that we try and bring our customers. That's one of the, outcomes there is the is the financial numbers, that that we just presented, and hopefully that will translate into sustainable growth going forward.

With that, I'll have Sanjay-bhai, or maybe we can just go on to Q&A.

Just to add very quickly, as Kunal mentioned, in the last call we had indicated that some new solution oriented trials are going on. I want to say that the trials are progressing positively.

Only thing is, it is taking a little more time given the complexity and the technicalities involved for us to get the results, but we are positively and quite excitedly working towards it. That is the reason why, in terms of opportunity, it remains the same.

I think our uniqueness remains absolutely intact. The trials are going on satisfactorily, let us hopefully wait and watch till we get the final outcome.

With that, I would request the moderator to open the house for Q&A.

Hi. Good evening, sir.

Am I audible?

Yeah.

Yeah. Sir, I wanted to ask you, in your mining volumes, which are close to 40,000 MT per quarter, how much of it is in India?

Approximately how much of that is to Hindustan Copper?

Mr. Jain, we don't give client-wise details, but broadly you can say that if you look at the mining volumes, on an average around 3 to 4,000 tonnes maximum would be from India, rest all will be from outside India.

We'll come back to you, just give me a moment and I will look at the numbers. Most of the mining volume is from outside India.

Yeah. No, I understand that.

Sir, since in the initial remarks you were saying that there's a lot of geopolitical uncertainty,

I will say that annually the Indian mining run rate would not be more than 10 to 12,000 tonnes a year.

Yes. Sir, like Hindustan Copper, they have said that they will increase their capacity from 3.5 million metric ton to 12 million metric ton by FY30-31.

That represents a big opportunity for AIA. How do you see?

Will that give us 30, 40, 50,000 metric ton structural volume increase over the next 5, 6 years?

Sir, [aisa hai?] , if I've been very honest with you, our fundamental focus in mining is actually the opportunity outside India.

The reason is, we are looking at very large, much much bigger markets like LatAm, where, between copper and gold, we are talking of at least a half a million ton kind of an opportunity on which we are working. Similarly, you look at Australia, similarly you look at some of the other markets, the key other markets being Africa, CIS, etc.

My point is that if you look at your sales, coming back to your specific question, mining volume in the domestic market in the third quarter was about 5,000 tonnes, and nine months period, the mining volume, one second. Where is the nine month?

Okay. Yeah.

On that run rate basis, you can say that in nine months, the volume was about 18,000 tonnes in mining in India.

Sir, my question was that only. Then for 3.5 million MT of Hindustan Copper, if this is 20,000, so that's a big number, right?

If they quadruple in the next 5 years, if we can also 3x or 4x these volumes, do you think that is possible? Specifically, I'm asking for

No, no. Let me give you a very simple perspective.

As I said over the previous calls also, we are currently focused on all these markets where the opportunity is significantly large. That doesn't mean that we are not looking at India.

Wherever in India there's an opportunity Hindustan Copper doubling or tripling the production of copper is something that as and when we move ahead, we will definitely evaluate and see what best we can do. As I said, from a growth driver perspective, the mining opportunity outside India is where our maximum efforts are concentrated.

In fact, for that matter, even iron ore production is going to go up. I'm not saying that India is not really a country of focus, but from a global perspective, the opportunity-wise, we are focused on markets which offer much much bigger opportunity at this point in time, where we are already being engaged and we are working very aggressively over last several quarters.

We are working in India. We have taken a lot of trials in India, we are supplying in India.

That's why if you see, my volumes have grown from quarter-to-quarter. We are currently in the run rate in India also as I've shared the numbers.

I'm very clear, the focus is outside India.

Sir. My second question was on capex.

FY26, I think you guided close to 180 cr, out of which 105 cr is done. Will balance 75 be done in Q4?

What about this China and Ghana, any timeline on that?

I'll tell you. Balance 75, 80 [mein?]

, around 30 crore is for our new solar hybrid capacity, which is committed and which is 100% going to happen in Q4, plus certain capex. I would say a realistic number is in the range of about 50 to 55.

Let us see, we are working on it for Q4.

Sir, China and Ghana?

China and Ghana, see, we are in the process. Land is procured in Ghana, we are awaiting for certain clearances from the governments.

That is not going to be significant in Q4.

No, no, sir, I was not asking for Q4. I was asking what is the outlook?

By when will the plants come up? That was the question.

See,

in Ghana, we have currently procured the land, done the site development, and are awaiting for certain clearances from the government, which I'm expecting to happen in this quarter. If that happens, then over next 1 and 1/2 years, we should have the Ghana capex in place.

China, we have initiated the process. We have set up a small lab also in China, and we are in the process of evaluating and finalizing the plans.

You can say over next 1 and 1/2 to 2 years, we should have both the facilities in place.

Sir. This my last question.

Last call, you said two large mines were in advanced stages and 10 to 12 others were in medium stages. What is the conversion?

Is this mill liner driven approach working? What is the mill liner capacity utilization for nine months and Q3?

See, mill liner based approach is the focus on which we are working right now. As I mentioned, Kunal mentioned, and myself also I mentioned in the initial opening remarks on the call, that the progress is happening satisfactorily, but it is taking a little time.

We are waiting. There are certain technical matters which we have resolved, and then again those trials are progressing quite satisfactorily.

The process has taken maybe 2, 3 more months. Let us wait.

There is nothing more that I have to add, but it is continuing.

Sir, capacity utilization of mill liners?

Mill liners also, see, capacity utilization currently are working at around 50%.

Okay. This is for nine months or Q3?

Nine months, nine months.

Sir. Thank you, and all the best.

Thank you. Thank you.

Hi. Hi, Kunal, and Sanjay.

Quite a steady quarter, I would say. My first question is regarding again coming back to the trials.

Essentially, for the sort of the large two mines that we were on very advanced stages, we should be expecting the results in the coming 2 to 3 months, is what you are saying, right, if I understood it correctly?

Correct.

Okay. The thing is I wanted

To be very clear, at least one mine in next 2 to 3 months, the second mine could be maybe 4 to 5 months.

That's even clear. Okay.

I also wanted to understand, let's say, how the forex effect works here. Just for my understanding, how much let's say of your sales currently, like a ballpark amount will also do, is USD-denominated?

The reason I'm asking is a lot of your costs are INR-denominated here. Eventually, because there is a sharp depreciation, how should we see the realizations, let's say, in a rupee term going forward, in that sense?

Hi, Priyanka, Kunal here. I think 3, 4 aspects to this, and I think we've shared this, over currency conversation in the past.

We are not don't

we are not an Indian exporter who benefits or loses on account of, the dollar change, because generally our the you know So, first of all, our transactional currency is US dollars. We're not dealing with we are selling to 140 countries, but we have at best dealing with a Canadian dollar or a euro or a Australian dollar and US dollar.

It's, most of it is US dollar. Most of our export transaction currency is US dollar.

The importing country generally would have seen a similar change like India has. When we sell to Australia, when we sell to Brazil, when we sell to all these countries, and by and large, the rupee So, if I'm if my cost is 1,000 or my selling price is 1,000 rupees, at 80, I was selling it, let's say, $1,200.

At 92, I'm selling at $1,150 or 11 whatever, what the math is. Yes, we do get to keep some difference when it's weakening, we do see a, we we do keep to get to keep some part of that, right?

By and large, it's a pass-through. Currency for us is a pass-through because it allows us to be more competitive.

It allows us to be at our optimal best. You get it?

When it appreciates or it depreciates like with raw material, there will be a lead-lag effect before it all passes on. In a way, I don't think you can take our numbers and say currency has gone up 5%, my margin will go up 5%.

Basically, that's what I'm saying.

There'll be some remnant of

There'll be some remnant of a lead-lag that will be there for next two or three quarters. Our endeavor is to make sure that it becomes a cost moat rather than a margin conversation.

Okay. Maybe what is the relative performance of the other local currencies also comes into the picture.

That's what I understand. Also, I think I heard when you were making your opening remarks, if I heard it correctly, almost 4,200 crores of cash you have.

Now, I believe even this cash it would also be largely USD-denominated or is it a domestic currency?

No, no. Outside of India, we only have transactional operating cash, which is less than 10% or 5% of the money.

Most of our investments are in Indian rupees in India, most of it.

Okay. Just one more question, if I may squeeze in.

Recently, we are hearing talks about the EFTA that has happened, touted like the mother of all deals. Can you highlight what sort of tariffs or duties that you're facing in Europe at present, and so if the deal translates over a period of time, would there be any benefit?

Fortunately,

we don't sell to Hermes or European luxury houses. Our customers are mines and cement plants, and generally Europe is not a very active player in these fields.

Europe FTA by and large, we're neutral to it. It does not change anything materially for us.

That's very clear. That's all from my side.

All right, thank you.

Hi. Good afternoon.

Am I audible?

Afternoon. Yeah.

Yeah.

The main question is, currently, if I'm not wrong, the capacity utilization is around 75%, right?

No, Devansh, overall, if you see, around 60% to 62%. See, plant-wise it will differ, but around you can say average 60% to 65%.

Okay. Now, sir, the thing is if the global markets, the mining business is boosting up, currently what we can see from last two quarters, the mining businesses, the commodities are selling very good at the prices.

Can you remark us if the capacity utilization rose up by 75% or 80% or 85%, the EBITDA level what we are posting currently is 27%, so that will also increase or any plan the capacity utilization to expand more?

Devansh, there are two different types of questions that you have posed. The first part is, are we linked directly to the fortunes of mining industry?

Currently you said that the prices of commodities are on the rise, does it create a separate set of an opportunity for us? Very honestly, we are a little agnostic to the mining industry cycles.

What we are focused on is this conversion opportunity. Just to recap on the gold, copper, and iron, these are the three main metals on which we are focused worldwide.

Market is huge. Market for consumable is maybe more than 3 million tonnes, but the addressable market for me on which I'm focused right now is maybe 1 and 1/2 to maximum 2 million tonnes.

[Usme?] , the penetration is 25%, 30%, 35%, penetration of high chrome based solutions.

It is this sweet spot of 1, 1 and 1/2 million tonnes on which I'm focused for conversion. Now, therefore, when I'm talking to the mines for conversion, I'm talking on three aspects.

One, I'm saying a very simpliciter thing that if you are consuming currently 8% to 10% of your total conversion cost is your consumable wear parts that I'm supplying, because my wear rates are very lower, I will reduce this consumption by 20%, 30%, so that your cost comes down to that extent. That is point number one.

More importantly, it is the entire grinding and crushing efficiency in the mining on which I'm focused. Therefore, I'm working on two aspects: one, improvement of throughputs.

This is very complicated. We started off with SAG mills, we're currently focused on some very unique ball mill centric solutions on which we have been talking about over last two quarters, and we are still very excited about it in terms of Though progress is slightly slow, opportunity is very positive and it remains in that trajectory.

Only thing is a little uncertainty as to what exactly, when exactly we can start talking about the volume growth, etc. That's why we are quiet about it.

That is one. Second is significant reduction in the other operating costs like power, etc.

You improve your throughput, you save power cost, and you also incidentally save on certain other consumable costs associated with beneficiation process like cyanide, etc. Our entire focus therefore is now a combination of unique liner plus our unique high chrome grinding media going as a package.

My point here is that whether a mining industry cycle is an upside or a downside, the benefit that I'm offering is much much materially different than anything linked to cycle. This is the first leg of your question.

The second part of your question was that whether I will get the benefit of operating leverage. You see, currently we are doing a very decent EBITDA in even at the operating level because of very favorable product mix and a very controlled kind of a cost.

At this point in time, we haven't done any major exercise, but if theoretically volumes double, then of course there could be some improvement. Having said that, whatever volumes are driving this growth, if it is more of a grinding media, it could be a different issue.

I would say we are refraining from giving any guidance on the margins. We are saying that we are operating at a decent margin and we want to continue operate at that level.

Of course, our guidance per se on an operating side at a much higher volume is actually lower, we are talking of 23%, 24% and not even 27%. That is actually not a function of operating leverage, it's a function of product mix.

Possibly for next three, four quarters, the capacity utilization will also not increase drastically.

I would not want to comment on that, honestly, because if the way I'm working on, if suddenly I get opportunity, I can increase my capacity utilization.

That's all from my side. Thank you very much.

Thank you.

Good evening, Kunal. Good evening, Sanjay.

Yes, good evening.

Could you give us a bit more flavor on the non-grinding media piece, which is the liners out there, especially if you could give us what was the output on the metal liners and what was the output on the hybrid liners that we've kind of expanded, where are we in that journey, and what's the kind of growth we are seeing in that segment of the business?

Got it, got it. Bhavin, I think the strategy seems to be reasonably clear now on what we are targeting and how we're going about it.

As part of that, which is the whole gamut of lining solutions which becomes an interface so that gold and copper miners can see increased throughput, all of that, that requires us to go through a whole trial journey, right, where we don't have case studies. There is resistance to doing a grinding media upgrade from forged to chrome because where there is zero process change, there is zero equipment change, it just needs a forge process.

Then the lining conversation becomes a little more, the challenge quotient increases a little more than just a grinding media conversation. The good part is there is a whole trial journey, right?

Where we are finding customers who have the most at risk from these issues, which is throughput drop and other things. We are at various phases of trials, and you go into a trial, these are all uncharted projects.

There is learning, there is one more iteration. It could be a design iteration, it could be an alloy interface, or it could be the whole solution that we have put together, which includes a few other elements, right?

All three put together is what makes it a little uncertain as far as timelines are concerned. The short answer is that our lining the whole lining solution that we have now put together and which we are hoping allows us the breakthrough to sell linings plus grinding media together as a solution is going through very serious trial journey.

This is in addition to doing work on the grinding media and the conversion, right, it's easy to fill the factory and say I've got 30,000 tonnes more of linings, but if that is not part of this solution and I'm just doing what the incumbent is doing, that does not further my goal, right? The goal is not to sell 30,000 tonnes of more liners and make 200 crores of more profit.

The idea is to sell 100,000 tonnes of liners plus grinding media as a solution and bring disproportionate benefit. All of that happens with part of the solution.

That's the medium-term to long-term strategy. As part of that, all I have to report is that we are undergoing various trials.

We are hoping some which have done well, where we are going to stage two, then somewhere we may have a redesign or a intervention in one of the three things that I said, and the others awaiting either trial timeline or production or supply. It's within the trial stage as we speak.

Sure. What if you could give us some indication in terms of the percentage of the volumes coming from liners and basically we have both the metal as well as the hybrid piece.

Bhavin-bhai, as I said in reply to a previous question, that we are currently operating at a little lower than 50% of our rated installed capacity. In fact, if you look at rubber and composite, that is the relatively newer capacity that we have created.

In fact, that particular capacity is still available even at a higher level. What we are trying to say that as soon as this ball mill related trials are over, there could be a significant uptick in the volumes of liners, which will also drive my grinding media.

That is the whole story. You get my point?

Focus is now on value creation rather than just pushing the volume of grinding media. Grinding media pushing is an incidental benefit I will get because of the uniqueness of the solution.

So, [ye thoda?] approach [hamara?]

[ekdam?] [pichle teen-chaar?]

quarter [se?] we have done this renewed strategy which for which we are working very hard.

Enough capacity is available. If I have to ramp up, I can easily ramp up further without any difficulty.

Today it is not a question of capacity utilization, today is a question of getting that significant breakthroughs which once that happen, things can turn around dramatically. That's all I think we will say at this point in time.

Let's please give us some more time.

Got it. No, the other part is, and please correct me if I'm wrong, South America is the larger producer of the copper globally, and to our understanding, and please correct me, 40% of the end market for grinding media and liners is the South America market, where we have a negligible presence as we speak, and we've got some breakthrough over there.

Now, in case we are successful, which we are, then given that the size of the market that is, we will quickly be running short of the capacity. Is that something that is there at the back of the mind that maybe some land, etc.

has already been acquired and we can quickly ramp up? This is the best case, while we have the last 4 years has been difficult, we understand.

Do we also have the ability to pick up very fast in case the South America goes well for us?

I think so. The thing is that with the work that we have done for China and Ghana, right, which is modular plants, a lot of that is quick setup.

As we speak, I think our capacity to set up production facilities is reasonably there, plus we have our plants in Bangalore and Trichy that we can ramp up and put together. I don't think capacity is going to be a constraint at all.

If you're seeing next 50, 70 we will not wait to get to 400 before we start thinking of a new plant, right? In fact, the day we cross 300, 330,000 tonnes, by the time the next 100 comes, we'll have the additional capacity happen about.

Absolutely, the customers in fact want to make sure that we've got the capacity, that any interruption does not make them suffer around it. Yes, we think about it, and there is a reasonable plan in place to if that good outcome happens, it will not be because of a lack of capacity that we fall short.

Great. Those were my questions.

Thank you.

Thank you.

Yeah. Hi, sir.

Just piggybacking on the previous questioner's question, sir, who is your biggest competitor in this mill liner business?

There are three or four incumbents. There is Bradken, there is an OEM called Metso, and then there is one more company from Indonesia.

There are four incumbents who do mill linings, but these are all conventional, there's no design element. It is just using the design or the spec that came with the mill whenever it must have been installed.

Okay. Sir, in this there is no in your grinding media business, you are trying to convert them from, say, forged to high chrome.

Here, you are supplying metal to metal, composite to composite, like that. There is no conversion element in the mill liner business, if I'm understanding it right.

Conversion is not in the alloy side, while that could also be part of the conversation. We're doing our own designs, the conversion, in a way, is where we are moving from whatever is the incumbent design to our design.

When I say our design, that also includes certain other elements that together become a solution. There is a conversion element, if you will, which is where someone uses a new element from what they are using currently.

I don't know if you want to call that conversion or not, but we are not per se doing incumbent design and just producing them and supplying that. Whatever work that we look to do will be our design product.

The metallurgy is not what you are targeting for the mill liner, right?

Generally not, generally not, no. It is also part of the conversation, but that's not what we're leading with.

You're right, in grinding media, our mainstay is to move from forge to chrome, which is a metallurgy conversation. There are other elements.

Metallurgy could be one of them.

Got it, got it. Sir, just two housekeeping questions.

One is on this US piece. With the tariffs and all, have you seen any customer drop-off?

It continues as is, but it's a punishing duty, but for now the customers are paying and importing the product. Not sure what it means going forward.

Oh, and so it's very commendable that with such high tariffs also if there's no customer drop-off, really shows that your product is very hard to replace for them. Just this last question, sir, FY27, I think in the last quarter con-call, you had said that you'll expect to get back to that 25, 30,000 MT volume run rate.

For FY27, '28, can we build that in? Can that much

At this point in time, but the bigger issue is not this 25, 30,000 tonnes, the bigger issue is how much we can do as a market share the way we have done in cement, and how we can grow on a medium to long term. One is, of course, this year looks flat, but over last couple of years, we have been struggling on various fronts.

Now this novel solution and the novel package that we are offering, we are looking at something very very different, radically different than this run rate of 25, 30 that we are talking about. I think, yes, that much we are not really worried about that 25, 30,000.

What we are looking at is something very very radically different, that's what we are trying to say.

Okay. Sir.

That's all from me. Thanks.

All the best.

Hi. Thank you very much for the opportunity.

My first question is on the Chile order. Could you clarify whether the offtake has already been started or is yet to begin?

Also, how should we think about the likelihood of this order converting into recurring basis post the completion of this offtake?

Yeah. We have started supply, Q3 includes supplies to Chile.

Of course, it's over 18 months, so that way it will continue, and we are pretty confident that it should continue on a recurring basis.

Okay. Our second question is on that since this is only a grinding media order, are we also doing trials or discussion with them to expand into package solution going forward?

Apart from this, the anticipated two or three orders in the next two quarters, would they only be grinding media or will it be a package solution?

There is no guidance, there is no two or three. I think these are all it ultimately gets down to some numbers, unfortunately you'll have to pardon us for What we're saying is, for liners, we are in various stages of trials, right?

For grinding media, again similar, but a different trial journey that goes along, but that includes other discussions around visibility of shipping, cost of shipping, and overall resistance to what what is happening. The Chilean customer, today we are focused on the grinding media bit.

We're not trying to get into the solution conversation because the grinding media has its own pathway, right, which is a little different than the solution pathway, right? Once one becomes successful and becomes trial tried and tested, then we'll have both strategies depending on, what is the pain area at the customer.

For now, I think the input is more on on what we are doing from our side than to give any color on one client, two projects, what happens in next six months. We really have very little to say about it, and we'll share as those developments happen.

Understood, sir. Thank you very much for answering my question.

I will get back into the queue.

Thank you.

Hi, Kunal, sir, and Sanjay, sir. My first question is Sir, with respect to the current significant rally in gold and copper prices, some of our existing large clients related to gold and copper, are they coming back to you discussing about increasing the mining output so that in one ways supply is catching up to the rally in these commodities?

Is that happening, something that are you seeing where the customers are coming back to the drawing board and saying we want to increase supply, therefore you need to supply more grinding media? Is that something that which is happening?

Ravi, the shortage and the problem is what we are seeing from 3 years. It's reflected in this high rally, and it's become public news today, right?

This is exactly what we've been saying is the top issue for a miner, for a copper miner, forget the rally and the financial consequence of it, like I said in my opening remarks, the world has mined 700 million tonnes of copper in all its mining history, right, which is all the wires and other things that we have. If the copper consumption grows only at 3%, which is normal world growth rate, you'll need another 700 million in next 18 years.

Okay? Now you add that with AI and your data centers, the amount of copper used in a data center is madness.

Then you have all the transmission for the renewables, and all your electronic device consumption. If all of that is growing, there is no copper coming up.

There is limited mines coming up, right? New mines takes 7, 8, 10 years to come along, they are all in ecologically sensitive environments, there are political issues.

In that sense, there is a clear and present danger that the world cannot produce enough copper. Now, something else will come along, demand goes down, all of these things we don't understand, but new mines are not coming up and the same mine is not able to produce the same volume than it last year.

Even before the rally, this was a problem for the miners, because whoever is in the mining space saw the writing on the wall. You get it?

To that extent, it is a clear and present danger. That does not mean that they are dropping all their anxiety or the concerns around the new solution and saying let's just try it.

They will apply their normal due diligence and protection measures to contain the risk out of this solution. Whoever we are talking to is absolutely very interested and fearful of making a change.

That's the dichotomy that we'll have to live with, right?

Just to add, Ravi, very important aspect of our solution is the fact that if you look at the key mines where we are working, some of the major ones, we can't name them, they have a history of last 3 years where because of the depleting quality of the ore, their output is in fact going down rather than going up. One of our value propositions is that if you use our solution without incurring major capex, we will be able to improve your throughput and therefore allow you to maintain your output.

Naturally, [woh jab naya capex karenge, naya mining karenge, agar unko koi bhi naya lease mila?] , we will be there as a part of the long-term solution.

Currently, it is helping them solve this key concern, and helping them reduce their cost and improving their throughput is what our focus.

Understood, understood. Sir, second question with respect to the volumes that we had lost, some close to around 40, 50,000 tonnes related to the geographies over the past 5, 6 years, that is South Africa, Canada, and Brazil due to the duties, etc.

How much of it would we have recovered and how much more potential is there in terms of recovery?

How much more potential from?

No, no. The volumes that we have lost in South Africa, etc.

South

Africa [mein koi recovery abhi hai nahi?] .

No, no. Listen, these are all protectionist measures.

It's a little speculative to imagine regime changes, duty changes. It is what it is.

We have to move forward from here and focus on what we can action on. Any recovery of volume is linked to changes in duty structures, and that's something that I think are here to stay.

We have stopped agonizing and speculating on when it will happen. We have to create a solution that will survive even that.

I think that's the message that we are internally taking away and working on.

Okay. Out of that 50,000 tonnes of lost volumes, not much would have been recovered is the way we should look at it.

Not really. No, no, no.

The total volume lost would be in excess of 75,000, 80,000 tonnes. Was there no duty, protectionist measures that the world has put up for last 5, 7 years, there's 80,000 tonnes of volumes overall that we've lost on duty measures.

That's what it is.

Understood, sir.

Only I can report that my profits have grown from 600 to 1,100 crores despite losing 30% of my volume.

Also, we have gained elsewhere, no? There is a replacement, compensation.

Compensation in the sense, you are talking about volumes

being This 60, 70,000 tonnes of volume loss is replaced by the new mines or the additional orders that we have got. That is how we have maintained a flat trajectory, or a marginal growth.

You get my point? That's what I was trying to intend.

Understood. The steady cutting duties that we had seen in certain countries like Brazil, etc., has that helped in you able to negotiate with the client and tell that please get back the volumes?

Has that happened?

Not really. I think, like I said, for wherever there is duty, let the country be, right?

That's something that there's enough for us to continue where some of these barriers are lower and we continue to work with that. Even in duty impacted areas, if my solution can prevail, but would I rather work on where the duty barrier is lower and there is an opportunity or should I go to the last bastion where there is an additional challenge for a duty cost impact, right?

Understood, sir. Got it, yeah.

Thanks.

Sir, am I audible?

Yeah. Very much.

Loud and clear.

Thank you, sir. Sir, we have a subsidiary by the name Welcast Steels, what is the future of that company considering that the plant is closed now?

No, sir. See, we have closed that plant, and we have also made disclosures on the stock exchanges.

The reason is, it was a fairly old plant, and we had created significant alternate capacities in our Ahmedabad facility. Correct?

It was not viable for us to invest heavily into that plant and to make it operational, and therefore we've closed it. Closure of that plant at this point in time, there is no plan to reopen it.

You can treat that particular thing as done and dusted. Having said that, if you remember, couple of times we tried to delist Welcast also, it being a listed company, but it could not be successfully done.

Right now, currently we have reduced all the operational expenses to the bare minimum, and we will see as we move forward how to deal with it.

Sir, why was the subsidiary acquired in the first instance if it was a fairly old

plant? Sir, that was done before 25 years when we did not have adequate capacity.

We had acquired it even before AIA started setting up expansion projects in Moraiya and Kerala. You get my point?

This is a history. Welcast was with me even before AIA went public.

That was when

we severed our relationship, and we severed the JV and we wanted some capacities quickly for southern markets. We got this opportunity as a listed company, previously owned by Times of India family.

Okay. Thank you, sir, and all the best.

Yeah. Thank you.

Thank you.

Yes, thank you so much. As always, Sanjay and I remain for any follow-on questions offline.

Wish you a very good evening, rest of the evening, and look to connect with you at the end of our fourth quarter numbers. Thank you.

Thank you.