REPORT ON

AIA Engineering Ltd.

For
Company Based Research
By
Akshat Avasthi
21077

In Partial Fulfillment for the award of the degree

Post Graduate Diploma in Management
Batch
2021-23

Specialization: Finance and Business Analytics

New Delhi Institute of Management

50 (B&C), 60, Tughlakabad Institutional Area, New Delhi-110062
E-mail: placement@ndimdelhi.org Website: www.ndimdelhi.org

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Type Fast Moving Industrial Goods (FMIG) |
Public Limited Company
City and Year of establishment Established in 1979 at Ahmedabad,
INDIA
Certified ISO 9001 Certified
Industry Design, Development and Manufacturing
Headquarters Ahmedabad
Products & Services High chrome grinding media, liners,
vertical mill spares, diaphragms and
mining liners Mill Audits, Turnkey
installation and commissioning projects,
Stock assessment and management,
Performance monitoring
Traded on BSE (Bombay Stock Exchange) & NSE
(National Stock Exchange of India)

Website www.aiaengineering.com

Submitted by-
Akshat Avasthi
21077
FA

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Company overview

AIA Engineering (NSE: AIAENG), Established in the year 1991, a certified ISO 9001
company, specializes 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.
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.

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Board of Directors
Mr. Rajendra S. Shah Chairman Independent–Non-
Executive
Mr. Bhadresh K. Shah Managing Director Executive -
Promoter
Mr. Sanjay S. Majmudar Independent
Mr. Yashwant M. Patel Whole-time Director
Mr. Dileep C. Choksi Independent Director
Mrs. Khushali Samip Solanki Non-Executive – Non-
Independent
Mrs. Bhumika S. Shodhan Non-Executive – Non-
Independent
Mr. Rajan Harivallabhdas Independent Director
Mrs. Janaki Udayan Shah Additional Director –
Independent

Committees of Board of Directors

1. Audit Committee:
Mr. Sanjay S. Majmudar - Chairman
Mr. Rajendra S. Shah – Member
Mr. Bhadresh K. Shah – Member
Mr. Rajan Harivallabhdas - Member

2. Nomination & Remuneration Committee:

Mr. Sanjay S. Majmudar - Chairman
Mr. Rajendra S. Shah - Member
Mrs. Khushali S. Solanki - Member

3. Stakeholders’ Relationship Committee:

Mr. Rajendra S. Shah - Chairman
Mr. Bhadresh K. Shah – Member
Mr. Yashwant M. Patel - Member

4. Corporate Social Responsibility Committee:

Mr. Bhadresh K. Shah - Chairman
Mr. Sanjay S. Majmudar - Member
Mr. Yashwant M. Patel - Member
Mr. Rajendra S. Shah - Member
Mrs. Khushali S. Solanki - Member
Mrs. Bhumika S. Shodhan - Member

5. Risk Management Committee:

Mr. Bhadresh K. Shah - Chairman
Mr. Yashwant M. Patel - Member
Dr. Ajit Nath Jha - Member
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 Mr. Sanjay S. Majmudar - Member
Mrs. Khushali S. Solanki - Member
Mrs. Bhumika S. Shodhan – Member

Services

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:
 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
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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.
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 capitalize 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.
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In spite of a possible near-term slowdown in wake of the impact of the Covid-19 Pandemic,
the company believe that this is likely to be normalized 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 new alloys, 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.

Outlook

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.

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In spite of a possible near-term slowdown in the mining industry in wake of the impact of the
Covid-19 Pandemic, the company believe that it should normalize 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.

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 MARKETING

Vision

Our philosophy is to provide customers with optimized solutions through technical evaluation
of their requirements.

Mission

Providing specifically designed solutions in ideal metallurgy for the application, plus offering
process optimization services worldwide.

Market Share: Current & growth rate since last 2 years value & volume

Current Market Share (RS CR) =17,895

Growth rate since last 2 years Value (%) = 2.686 downward

Jan 2020 = 18911 (Rs CR)

Jan 2022 = 17895 (Rs CR)

Growth rate since last 2 years Volume (%) = 47.274 downward

Jan 2020 = 840.10k

Jan 2022 = 45.81k

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SBUs if applicable & Product Portfolio

SBUs: N.A.

The company’s product portfolio consists of

 High chrome grinding media

 Liners

 Vertical mill spares

 Diaphragms and mining liners

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The company's manufacturing capacity is 115,000 MT of high chrome grinding media, liners,
vertical mill spares and mining liners and 100 diaphragms per annum.

Major competitors of AIA Engineering Ltd.

Bharat Electronics Limited

Bharat Electronics Limited (BHEL) is an Indian Government-owned aerospace and defence

electronics company. It primarily manufactures advanced electronic products for ground and
aerospace applications. BEL is one of nine PSUs under the Ministry of Defence of India. It
has been granted Navratna status by the Government of India.

Thermax

Thermax Ltd is an Indian engineering company, involved in energy and environment,

headquartered in Pune. Thermax’s business portfolio includes products for heating, cooling,
water and waste management, and specialty chemicals. The company also designs, builds and
commissions large boilers for steam and power generation, turnkey power plants, industrial
and municipal wastewater treatment plants, waste heat recovery systems and air pollution
control projects.

11 | P a g e
It was founded as a family concern in 1966 by A. S. Bhathena and later taken over by his
son-in-law, Rohinton D. Aga (R. D. Aga), who served as the Chairman and Managing
Director until his death in 1996. The company went public in 1995. After his death, R. D.
Aga's wife, Anu Aga, who was heading HR at the time, became the chairperson.

Bharat Heavy Electricals Limited

Bharat Heavy Electricals Limited (BHEL) is an Indian government owned engineering and
manufacturing enterprise based in New Delhi, India. It is under the ownership of Ministry of
Heavy Industries, Government of India. Established in 1956, BHEL is India's largest power
generation equipment manufacturer.

BEML Limited

BEML, abbreviation; Bharat Earth Movers Limited, is an Indian Public Sector Undertaking,
with headquarters in Bengaluru, Karnataka, India. It manufactures a variety of heavy
equipment, such as that used for earth moving, transport and mining.

GMM Pfaudler

GMM Pfaudler (previously known as Gujarat Machinery Manufacturers) is an Indian

Industrial Engineering company which manufactures engineering equipment and glass-lined
equipment for the global chemical and pharmaceutical markets. Its headquartered in
Karamsad, Gujarat.

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Name Market Cap. Sales Total Assets
(Rs. cr.) Turnover
Bharat Elec 52,666.96 14,063.83 10,807.89
Thermax 21,505.33 3,131.48 3,020.13
BHEL 20,909.79 17,308.44 31,317.83
HLE Glascoat 7,959.21 420.71 239.55
GMM Pfaudler 7,474.07 640.81 447.41
BEML 7,204.91 3,557.21 2,866.30
Praj Industries 6,511.21 1,088.54 777.00
Triveni Turbine 6,065.21 696.93 592.42
KSB Pumps 4,286.41 1,208.10 906.44
NESCO 4,052.15 291.09 1,526.50
Tega Industries 3,964.66 496.82 959.10
Greaves Cotton 3,569.26 1,329.06 900.95
Everest Kanto 2,761.43 750.63 479.79
Action Const 2,679.37 1,227.01 574.54
Kirloskar Bros 2,648.68 1,799.90 1,181.97
Kirloskar Oil 2,618.23 2,694.44 2,060.83
Elecon Eng 2,118.34 796.36 1,025.17
Lloyds Steels 1,945.68 70.05 114.01
Genus Power 1,825.73 608.60 1,129.10
Kirloskar Ind 1,472.00 29.90 1,427.40
Kabra Extrusion 1,463.36 274.24 302.39
TAEL 988.66 279.13 337.40
United Drilling 912.83 142.85 212.04
Skipper 790.05 1,581.51 1,097.30
Salasar Techno 722.55 583.31 445.01
KGIL 621.23 103.50 311.77
Hercules Hoists 456.96 78.37 494.40
Tembo Global 282.54 104.62 52.49
Gujarat Apollo 255.18 29.17 263.41
Emkay Taps 253.98 56.28 145.76
Revathi CP 253.04 84.74 215.79
Mazda 244.41 152.42 148.24
Windsor 243.17 287.22 313.10

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Pennar Eng 215.42 604.59 286.35
Walchandnagar 198.73 325.64 544.48
Eimco Elecon 192.89 125.84 325.77
TRF 151.04 113.95 -25.58
TIL 141.48 312.40 560.62
Nitin Fire Prot 61.38 55.20 378.46
Marshall Machin 60.24 67.14 82.76
Manugraph Ind 59.61 29.69 143.02
Advance Meter 38.38 14.65 180.08
Bil Energy 12.68 -- -55.69

Latest innovation and practices in the Marketing Mix since last 5 years

The company is going through a capital crunch since 2010, hence there has been no new
innovation. The basic marketing mix is as follows:

Product

AIA Engineering Ltd is a niche player in the VALME added high chrome metal segment
catering to the cement, mining and thermal power industries in the grinding/crushing
operations.

Two types of mills are used for the grinding operation in the above-mentioned Industries -
Tube mills (which are horizontal) and vertical mills. AIAE is involved in design,
manufacture, supply and services of various parts in these mills, collectively called as mill
internals.

The essential purpose of the mill is to grind the raw materials/inputs and it forms a very
critical part of the production process as it has a direct bearing on the cost and quality of the
final output.

Tube Mill – Operational overview

A Tube mill for cement grinding is a horizontal cylindrical shell and the inner surface is fitted
with wear resistant Liners. Spherical balls of different sizes, collectively called as Grinding
Media, and the material to be ground are fed to the mill from one end. The mill is made to
rotate around its axis. The working profile of the first chamber liners are designed such that
as a result of this rotation, the grinding media are lift to a specified height and dropped on the
material. The feed is crushed and ground DME to the impact and abrasive action of the balls.

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Apart from the grinding operations, the liners and the grinding balls protect the main body of
the mills from wear and tear.
The Mill is separated into two chambers by an assembly of diaphragms, grates and black
plates which screen the feed such that only a certain size of feed can pass into the second
chamber

The end product of fine material is discharged from the other end through a discharge
diaphragm. For mineral grinding, tube mills normally have a single chamber without
partition.
Tube mill internals - product profile grinding media
Grinding Media are cast steel high chrome balls must adhere to standards like:
 Sufficiently hard, abrasion and wear resistant to deformation
 Should not develop cracks on the surface during the operation.
 The core of these balls should have uniform distribution metallurgical, which is
developed from satisfactory heat treatment.

The cost of grinding media as compared to other operating cost like Power for grinding may
be quite low but its influence on the production and efficiency is significant.

AIAE´s expertise-
The company provides customized solutions as regards alloy compositions and other
metallurgical aspects to provide the most economical alternative. It results in-
 Uninterrupted mill operations optimum mill efficiency.
 Increase in mill availability solution to the customer.

Place

AIA Warehouses
 RSA
 USA
 UK
 Netherlands
 Australia
 Ghana

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 India 25 KT

Unprofitable products/segments

• Inability to scale up the capacities rapidly owing to extremely high importance of absolutely
zero failure rate of the products expected from the customers, requiring close monitoring of
the quality.
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• Issues related to logistics, particularly with the increasing volumes of the products.

What is your company’s positioning?

It is a company, which makes grinding media for cement, and mining companies. We can
call it an FMIG (Fast moving Industrial Goods) company comparable to FMCG companies.
The cost is low compared to the total costs but the company needs it to function, hence there
is customer stickiness.

The company is into the production of high chrome mils for major plants, hence, there will be
customer stickiness as existing customers would like to stick with a quality supplier and the
demand is mostly replacement so no one will change suppliers, as the costs are a small part of
their overall costs. In addition, the lack of comparable industries also perhaps explains their
high ROCE.

SWOT Analysis

AIA Engineering Ltd. is uniquely positioned as a supplier of High Chrome Mill Internals on a
global scale, on account of the following -

STRENGTHS

• Strong focus on the combination of Metallurgy, Design and Applications.

• Comprehensive solutions-based approach, as distinct from supply of commodity products.
• A strong focus on technology research and development.
• Worldwide presence in more than 60 countries, being directly in front of the customers
through a network of overseas marketing subsidiaries in the Middle East, Europe and USA,
warehouses in Europe and USA; and agents in various other countries.
• Low cost of production owing to India specific advantages.
• Strong strategic commercial partnerships with leading OEMs and customers.
• A strong management team comprising of Technocrats, Professionals and Consultants
having rich experience in High Chrome Mill Internals industry.

WEAKNESS/THREATS

• Inability to scale up the capacities rapidly owing to extremely high importance of absolutely
zero failure rate of the products expected from the customers, requiring close monitoring of
the quality.
• Issues related to logistics, particularly with the increasing volumes of the products.

OPPORTUNITIES AND STRATEGIES

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• To tap the opportunities available in the global Mining segment.
• Segment in the Chinese Market.
• To maintain and further strengthen our capabilities of offering total solutions by increasing
our focus on Research & Development activity.
• To focus more on strategic relationship/ commercial partnerships with international groups.

Compare the SWOT of your chosen company with one/two competitor/s.

SWOT Analysis of BHEL (AIAE’s Competitor)

Bharat Heavy Electricals Limited (BHEL) is an electrical equipment industry that was
formed during the year 1964 and is headquartered in New Delhi, India. It is owned and
formed by the Government of India.

It is the largest power generation equipment manufacturer that manufactures various products
like Gas and Steam Turbines, Boilers, Electric Motors, Electric Locomotives, Generators,
Heat Exchangers, Switchgears and Sensors, Automation and Control Systems, Power
Electronics, and Transmission Systems.

During the year 1991, BHEL was converted into a public limited company. Over a period of
years, it has developed the capacity to produce much equipment for all sectors.

BHEL is engaged in various operations like design, engineering, construction, testing, and
servicing of many products. BHEL has a huge network of about 17 manufacturing units, two
maintenance units, eight service centers, four regional offices.

It also has eight overseas offices and seven joint ventures. BHEL has established the
competence to deliver about 20,000 MW p.a. of power equipment to meet the rising demand
for power generation equipment.

BHEL has been transferring its power and industry segment products and services for about
40 years. Its global visibility has been spread across 76 countries in about six continents.

Strengths

 Strong Base in Engineering – BHEL has a strong base in engineering and a stable
industrial relationship. It is the largest power generation equipment manufacturer that
manufactures various products like Gas and Steam Turbines, Boilers, Electric Motors,
Electric Locomotives, Generators, Heat Exchangers, Switchgears and Sensors,
Automation and Control Systems, Power Electronics, and Transmission Systems.

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  Continuous Profits – BHEL has been generating continuous profits and paying
dividends since the year 1974. This is a great strength to the company.
 Support from Collaborators – BHEL has great support from the collaborators that
have helped them to obtain many modern technologies and then transform it to suit
the Indian conditions.
 Huge Customer Base – BHEL has a huge customer base in the domestic business that
leads to being popular and having a greater influence in the market.
 Huge Products – BHEL produces almost 190 products and more than 30 major
product groups.
 Quality Products – The Quality foundation of BHEL is quite strong. During the year
1970-90, BHEL has implemented Quality Manual for the entire organization that
includes systems, tasks, procedures, and processes. Second tier documents like
standard technological procedures, test plans, process sheets, non-conformance
handling systems, and procedures were implemented during this time. Since that time,
BHEL is leading in Calibration System, Quality Planning, and Quality Circles
impression in India.
 Research & Development – BHEL has always faced a strong emphasis on innovation
and creative advancement. It has led to the develop many technologically competitive
products and services. Their labs at the Research & Development wing have
Permanent Magnet Machines, Insulation, and Chemical Sciences, Intelligent Machine
Control, Electrical Machines, Power Electronic Systems, High Voltage Engineering,
GIP, and Switchgear Development, and many more.

Weaknesses

 The inability for Certain Activities – There has been few situations have BHEL had
the inability to provide supplier’s credit, financing of power projects, and soft loans.
 Longer Delivery Cycles – BHEL delivers products by taking more time than
international competitors. This could be a weakness having longer delivery cycles
would have a huge impact on the business.
 Less Marketing Infrastructure – BHEL lacks effective marketing infrastructure that is,
in fact, a weakness for the company.
 Procurement Process – The procurement process in BHEL is cumbersome, and they
are subject to auditing.
 PSU Status – PSU status is yet another weakness for BHEL as it is subject to the rules
and regulations. It is forced to carry a huge amount of labor force that is unable to
reduce.
 Criticism – The BHEL project, 1340-megawatt coal power plant situated in Rampal
that is close to the Sundarbans Mangrove Forest for Bangladesh-India Friendship
Power Company is a joint venture. This project has faced a lot of criticism for
impacting the environment and the likely harm that could cause to the largest
mangrove forest in the world.

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Opportunities

 Demand for Power Domain – There exists a huge demand in the power domain to
produce more equipment. This provides a huge opportunity for BHEL.
 Aging Power Plants – As BHEL is into the industry for a long time, there are many
plants that are quite old and require services and spare parts. On doing this, BHEL can
carry out production faster and attach more visibility in the market.
 Increased Private Sector Participation – BHEL sees a healthier work environment and
increased private sector participation in the operation of distribution circles as well.
 Increase in Defense Budget – An increase in defense budget sees a lot of opportunity
for BHEL as it will increase the top line for them.
 Joint Venture with Siemens – Power Plant Performance Improvement Ltd, which is a
joint venture with Siemens, is a tie-up that will be beneficial and provides a lot of
scope for the business.

Threats

 Competitors – BHEL faces a lot of competition from both the international and
national companies.
 Associations in the Industry – Associations in the industry have drastically reduced
the company’s turn over. This is, in fact, a big threat to the company.
 Increase in Small Contractors – Increased in the number of small contractors is a big
threat to BHEL that leads to price wars.
 New Players in the Market – Emerging new players in the market is also a serious
threat to the company.

Identify the best practices of the firm resulting in increasing consumer

base/ ensuring retention /satisfaction

Unique Business Model – A complete solutions provider

The company is not merely a supplier of superior quality products but also provides complete
solutions to its clients. AIA engineers improve upon the application, design and metallurgical
aspects of the mill internals only after understanding the client's requirements. They not only
deliver products but thrive for process optimization. This results in enhanced performance
and reduced wear rate, a profitable preposition for the clients. Besides, AIAE also offers
technical services ranging from inventory management, mill audits, and ball-charge
management and testing services which are crucial for the smooth functioning of the plants.

Superior Products – Metallurgical aspects

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High chrome mill internals manufactured by AIAE offer reduced wear rate of the grinding
elements and greater control on the grinding process compared to conventional alternatives
like manage steel and forged steel internals. It results in a favorable cost benefit ratio for the
customers.

High Entry Barrier

AIA has been catering to the needs of the user industries for two decades and a half.
customers are reluctant to experiment with newer source of supply as regards mill internals as
a snag in the grinding process would lead to stoppage in production. AIA already has
strategic relationships with majority of the them and a steady flow of replacement demand is
also expected from them.

The cost saving achieved through extended wear life of components and reduced downtime
far outweigh increase in product cost making the experience and expertise of the supplier of
paramount importance.

Market Leader

AIA has majority market share of the organized sector for mill internals for cement plants in
the domestic market and a significant share of the global cement plant market. With new
capacity addition underway for AIA coupled with a strong domestic and international repute,
the market share is expected to go only one way with sustained margins.

Catering to core industries with huge potential

Demand of mill internals is a derivative of the expansion in user industry and replacements.
Major users of mills internals include cement, mining and utilizes
thermal power plant sector.

In India, the cement industry is expected to grow at P% CAGR and at S.6% globally. In India
the demand supply gap is expected to be bridged by capacity expansion. Incremental demand
is also expected to be met through blending process which is expected to meet 5D% of the
demand in future and all in all this would result in a spurt in demand for grinding mills.
Blending process is extremely profitable to cement companies at it does not require clinker
capacity and thus gives flexibility when demand is low. The bigger players have already
announced their plan for the fame.

Globally demand for mill internals from cement is expected to grow at ff-5% CAGR and
AIAE has lot of scope to increase its presence in this market.

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AIAE supplies to all the major power generators including State Electricity boards and NTPC
and is a preferred supplier with most. Mining also represents a large opportunity for the
company

Highly Scalable Business

The lion’s share of demand of the consumer arises from the mining industry followed by
cement and thermal power producers. Moreover, mining industry is several times the size of
the cement industry.

AIA's products have been successfully tested with Indian and International miners who have
traditionally been using other alloys. This category represents majority of the users, in other
words it represents the potential market.

With capacity expansion underway for AIA and strong relationship with domestic and
international customers, the company is expected to garner huge orders from this segment,
going forward.

Strong domestic and international client relationships

Leading Original Equipment manufacturers in Cement, Mining as well as Thermal Power

plants source their requirement from AIAE, India’s largest player in High Chrome Mill
Internal Segment.

The company has a global footprint with presence in North and South America, Europe,
Middle east, far east, Australia and Africa, under the Vega Brand through its wholly owned
subsidiaries in US, UK and Middle east. It has supply contracts with most global cement
manufacturers and has forged strong commercial relationships.

AIAE's forte lies in its customer centric philosophy and the reputation of being total solutions
provider stands it in good head as far as client relationship is concerned. engineers of AIAE
pay regular visits to the plant to comprehend the requirement of the clients and take proactive
steps towards problems resulting in long lasting and rewarding relationship for both the
parties.

Highly Qualified and Experienced Work Force.

Headed by Bhadresh Shah, an IIT Engineer, and backed by a team of other technocrats,
engineers and professionals with rich experience in the metallurgy and grinding processes are
the intangible assets of AIAE. The company has a highly qualified and experienced technical
team and a strong sales team having rich experience in the high chrome mill internal industry
with a well-established marketing network. The company has about 250 engineers with an

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average work experience of 10 years. This amounts to over 2500-man years of experience
within their domain.

Identify if there has been a change in company Policy / procedures as well

as that of the competitor/s WRT the above in the last twenty months due to
COVID 

No change has been made in policy of AIA Engineering Ltd. after the covid-19.

AIA Engineering Limited informed the exchanges Wednesday that it has decided not to break
ground on the second phase of greenfield capacity expansion of 50,000 Mt of Grinding
Media. This will most likely be deferred to the next fiscal year due to Covid-19 impact.

“The company is in the midst of setting up Greenfield plant for the manufacture of Mill
Lining with work and spend done on the same in FY 2019-20. We will continue on this
project in this fiscal year with an estimated spend of INR 150 crores in FY 2020-21 with
likely commissioning before March 2021,” it said in a release.

The company operations had been affected after the Covid-19 outbreak in India in March. It
resumed partial operations last month and manufacturing was operationalized in a staggered
and restricted manner and is now at 70% next capacity utilization.

“As a strategy, we maintain stock at many locations closer to plants and we are able to
service customers from these warehouses,” it added.

The company has seen lower off take in the months of April and May and hopes soon things
will revert to normal.

AIA Engineering Ltd traded at Rs1,600.80 down by Rs47.25 or 2.87% from its previous
closing of Rs1,648.05 on the BSE.

Recommend practices to the company to increase consumer satisfaction

and /or consumer base in next 2 years in the changing E-commerce and
online integration

The company is a quality company with an established track record and high customer
stickiness due to network effects. The company also has a good runway for growth given the
opportunity to convert the grinding media to Ferro-chrome. Further, the cost reduction
brought into the customers’ operation and it being FMIG good makes the company have a
competitive advantage. However, it is somewhat constrained by the cyclicality at its end
customers which also exposes it to raw material fluctuation. The company has a clean track

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record of corporate governance. Hence, the company can surely be bought at reasonable
valuations, as it will have a high rate of reinvestment of incremental capital generated.

Why do you think customer feedback is important?

Customer feedback is information provided by clients about whether they are satisfied or

dissatisfied with a product or service and about general experience they had with a company.
Customer opinion is a resource for improving customer experience and adjusting your actions
to their needs. This information can be collected with different kinds of surveys (prompted
feedback), but you can also find opinions and reviews your clients post online (unprompted
feedback) and collect them using Internet monitoring tools. Both sources are important to get
a full picture of how your clients perceive your brand.

Customer feedback helps to measure customer satisfaction

Customer satisfaction and loyalty is a crucial factor that determines a company’s financial
performance. It is directly linked to many benefits, such as increased market share, lower
costs, or higher revenue. Many studies confirmed the close connection between customer
satisfaction and business performance. Therefore, there is no doubt that you want to make
sure your clients are happy with your products and services. Naturally, the best way to find
out if you meet their expectation is to get their opinions. Using rating-based questions you
can easily estimate the level of satisfaction and consequently predict your company’s
financial condition in the future.

Collecting customer feedback shows value and their opinions

By asking your clients for feedback you communicate that their opinion is important to you.
You involve them in shaping your business so they feel more attached to your company.
Listening to their voice helps you create stronger relations with them. This is the best way to
gain valuable brand ambassadors who will spread positive word-of-mouth for you. And I am
sure you are aware that their recommendations are probably the most effective and, at the
same time, the cheapest way to acquire new customers and become more trustworthy in the
eyes of your current and potential clients.
People always appreciate when you ask them if they are happy (or unhappy) with your
service. It shows you actually value their opinion and that you are here for them, not the other
way around. They feel that your primary business goal is to solve their problems and fulfill
their needs, not to get their money. It puts a customer in the central position of your company
and this is the right way to run a business.

Customer feedback helps to create the best customer experience

Today’s marketing is heavily based on experiences people have with products, services, and
brands. They do not buy Apple products just because they are good. They want to
demonstrate their status and affiliation to a particular group. They do not buy Nike clothes
because they are durable. They buy courage to extend their boundaries. Therefore, if you
focus on providing the best customer experience at every touchpoint client will stay loyal to

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your brand. And naturally, the most effective way to give them an amazing experience is
asking them what they like about your service and what should be improved.

Customer feedback helps to improve customer retention

A satisfied customer will stay with you. An unhappy customer will eventually find a better
alternative to your business and leave. Customer feedback benefits are significant. It helps
you determine if your clients are satisfied with your service and detect areas where you
should improve. Thanks to asking for opinions regularly you can always keep a finger on the
pulse. Each time a dissatisfied customer expresses his disappointment you can immediately
react and find a solution to fix an issue. This is a perfect moment to win a client back and
even increase his level of loyalty. In many cases, an unhappy customer who encountered a
problem with your service, but you got it fixed straightaway demonstrates bigger devotion to
your brand that a customer who has never been disappointed with your service.

Customer feedback is a reliable source for information to other consumers

In the times of social media, consumers do not trust commercials or expert advice so much.
Opinions provided by other customers who have already used a product or service are more
reliable source for information these days. When you look for an accommodation in a city
you visit or you want to find a nice new restaurant to have dinner with friends you read
reviews beforehand. When you want to buy new shoes, you ask for opinion on Facebook or
go to a trustworthy blog to read a review. Many companies today incorporate review system
in their services and products. Think of Uber, or AirBnb. They all do their best to ensure that
poor service will be detected and excluded from their business.

Customer feedback gives you data that helps taking business decisions

There is no place for business decisions based on loose guesses on a highly competitive
market. Successful business owners gather and manage distinct kind of data that helps them
develop future strategies. Only in this way they are able to adjust their products and services
to perfectly fit customer needs.
Customer feedback is one of the most reliable sources for tangible data that further can be
used in taking business decisions. Customer insights will help you understand clients and
their needs more profoundly. Take their suggestions into consideration and thanks to that find
out where you should allocate your money to get the highest return on investment. You might
discover that, for instance, further product development is not necessary in your case, but
instead you should focus on promoting your brand to get bigger exposure. Customer feedback
is a valuable source for such data, but you must learn how to listen to it and how to translate
it into actionable takeaways for your business.

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How much importance do you give to the customer reviews while buying
the product?

While buying the new product online I pay more attention to consumer reviews as it helps me
to know more about the quality and performance of the product as review is based upon the
usage of the product by the consumer. Consumer review helps to know the best product
online and also gives a choice to select a best alternative.

I used to see consumer review on many different online sites to know more and more about
the product performance.

What else would you like this company to do to stay ahead of the
competitors?

AIAE can always focus on its growth strategy to stay ahead of the curve, that being –

Increased R&D
focus to further
strengthen total
solutions
capabilities

To develop
Continue to build solutions of
on predominant improved wear
position in cement parts for crushing
globally with and grinding
strategic focus on equipment
emerging markets
and China AIA (Crushers -SAG
mills to Regrind
Engineering mills)
Ltd

Growth Strategy – Focus on Mining Industry

 Annual replacement market in Mining Industry which can be targeted as estimated to

be around 3 million TPA.

 High chrome penetration is less than 15%, hence large conversation opportunity
available for growth.

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  AIA passes significant benefits to mining industry stated as below:

 AIA passes significant benefits to mining industry stated as below:

• Lower wear rate

• Improving process
efficiency
• Reduction in other
consumables
Advantages • Environmental friendly
• Improvement in Recovery
• Reduction in operational
cost-OPEX
• Process optimization
• One Stop Solution for
entire process

 AlA has already established global footprint in major global mining companies

Mill liners opportunity

 Solution with improved mill lining design (JV with a US based Company)

 Company is setting up a Greenfield facility with rated capacity of 50,000 MT

which is estimated to be commissioned by December 2020.

 Company has already procured land for this project and obtained necessary
approvals for building this plant.

Mill linings designed under this initiative will offer improvements in:
 Throughput of mill
 Power consumption
 Global market of 300,000 MT

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