AIA Engineering Limited — Q1 FY24
AIA Engineering reported a strong Q1 FY24 with sales volume of 74,000 tons, a record for the first quarter, driven by mining segment growth.
bullish
medium
✓ Verified against BSE filing
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
67%Questions answered3Evaded / deflected12Questions auditedContradictedNumbers vs filing
Answered
Medium priority
Why were other volumes low this quarter?
Asked by Ashutosh Tiwari, Equirus Group
Management gave a clear, direct answer that it will normalize.
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Question
On others volume, this quarter was a bit low. Is it like a quarterly phenomena or should normalize on a full year basis?
Sanjay Majmudar, Non-Executive and Non-Independent Director
It will normalize. It will normalize.
Answered
Medium priority
What is the INR 8.3 crore withholding tax provision?
Asked by Ashutosh Tiwari, Equirus Group
Management explained the nature of the provision and the reason for writing it off.
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Question
there's some line items saying that there's INR 8.3 crores provision related to some withholding taxes recoverable in overseas reductions. What is that exactly?
Kunal Shah, Executive Director
we are facing some sort of issues in terms of recovering that. As a cautious, prudent measure, we have shown, we have written that off while we make efforts to recover that.
Partial answer
High priority
How is South America as a market and traction there?
Asked by Ashutosh Tiwari, Equirus Group
Management expressed bullishness but gave no specific traction or order details.
no specific traction detailsdeferred to future
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Question
How is South America as a market, looking for us, what we have done, and how do you see it going ahead?
Sanjay Majmudar, Non-Executive and Non-Independent Director
We remain extremely bullish on North America, Latin America. Peru is extremely critical for us. We are strengthening our presence there.
Answered
High priority
Will the reduction in freight costs be passed through?
Asked by Dhananjai Bagrodia, ASK Investment Managers
Management clearly stated freight is a pass-through with a timing lag.
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Question
Our OP per ton has increased sharply because of the reduction in freight costs. Is that something which we see stabilizing? Would we have to pass this on back to customers?
Kunal Shah, Executive Director
Freight is, like our other raw material cost, is conceptually a pass-through. There is a timing difference, but freight rates are going down, that will be a pass-through.
Evasive
High priority
What is the fair estimate for OP per ton for the year?
Asked by Dhananjai Bagrodia, ASK Investment Managers
Management declined to give OP per ton guidance and redirected to margin percentage.
refused to give OP per ton guidanceredirected to margin percentage
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Question
Any guidance on what OP per ton would be then a fair estimate for the year, considering 46,000 is significantly much higher than...
Kunal Shah, Executive Director
We don't have a fixed price. It's not an absolute number. It will depend on the selling price. We are guiding in terms of margin, operating margin, which is a 20%-22% directional guidance.
Answered
High priority
Why is the margin profile so strong this quarter?
Asked by Bhoomika Nair, DAM Capital Advisors
Management explained the reasons for strong margins: product mix and freight lag.
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Question
We've seen a very strong margin profile in this quarter. Is that got to do with the lag in pass-through of the lower prices of raw material freight?
Sanjay Majmudar, Non-Executive and Non-Independent Director
One very important factor is product mix. If the product mix is more tilted towards bigger or larger castings, then definitely the margin profile will improve. There is also an effect of freight cost going down.
Partial answer
High priority
Where are we seeing traction for incremental volumes?
Asked by Bhoomika Nair, DAM Capital Advisors
Management gave a qualitative update on trial locations but no specific client or volume details.
no client namesno specific volumes
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Question
Where are we seeing traction? How many new clients? What kind of volumes are under trials?
Sanjay Majmudar, Non-Executive and Non-Independent Director
We will not give you client-wise details. However, there are several new mining locations, at least 30, 40 new mining locations, which are under trial stage.
Evasive
High priority
When will margins normalize to 22-23%?
Asked by Ashwani Sharma, ICICI Securities
Management refused to give a specific timeline for margin normalization.
no quarterly guidancerefused to give timeline
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Question
At what point in time, maybe in next quarter or quarter, if you can give some indication that it will normalize to 22%-23%?
Sanjay Majmudar, Non-Executive and Non-Independent Director
We don't guide on a quarterly basis. We only give a minimum base-level margin guidance. In Q2, you may again find us coming to 25%. We are cautiously making a statement that this should not be extrapolated.
Answered
Medium priority
What is the current volume to Brazil?
Asked by Ashwani Sharma, ICICI Securities
Management gave a clear volume range for Brazil.
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Question
What is the current volume that we are doing to Brazil?
Sanjay Majmudar, Non-Executive and Non-Independent Director
We'll do about 10,000. Full year, about 8,000-10,000.
Answered
Medium priority
What is the total industry size for grinding media balls?
Asked by Garvit Goel, Invest Analytics
Management provided specific industry size estimates.
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Question
My first question is on the total industry size, as of today, for grinding media balls, and how much of it belongs to high chrome grinding balls?
Sanjay Majmudar, Non-Executive and Non-Independent Director
We are talking of a replacement opportunity of 2.5 million-3 million tonnes. Addressable opportunity is in the range of 1.5 million-2 million tonnes. Penetration of high chrome is in the range of 400,000-500,000 tonnes.
Answered
High priority
Why only 10-12% volume growth when product is good?
Asked by Garvit Goel, Invest Analytics
Management explained the slow conversion process and conservative guidance.
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Question
What is stopping us to have 20%-25% kind of growth if our product is so good for the customers?
Sanjay Majmudar, Non-Executive and Non-Independent Director
The conversion process itself is very slow. It takes one or two years for us to convert every customer. We are always conservative in guidance.
Evasive
High priority
Are you seeing incremental traction in Latin America after freight normalization?
Asked by Amar Kedia, Ambit Capital
Management acknowledged the improvement but gave no specific traction or numbers.
no specific traction detailsdeferred to future
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Question
Now that freight costs have more or less normalized, are you witnessing incremental traction for the Latin American markets?
Sanjay Majmudar, Non-Executive and Non-Independent Director
We're now back into the market. I think shipping has become like your utility in terms of predictable. Those converse, it will not be everything okay. Nothing specific to report at this time.
Quantitative claims vs filed numbers
| Claim | Management said | Filing | Verdict |
|---|---|---|---|
| Operating margin directional guidance of 20%-22% | 22% | 28% | Understated vs filing |
Filed figures sourced from Screener.in. Claims within a small tolerance of the filing are marked “matches filing”.