At a Glance (Excerpt)
AIA Engineering, the world’s second-largest grinding media manufacturer, has crushed and cast its way through FY21–25 with decent profit compounding (14% CAGR), flat revenues, global expansion plans, and… anti-dumping duties from Uncle Sam. But can a company with 485 working capital days ever run lean? Or is this just a slow-burn multibagger with steel nerves?
1️⃣ Flashback Begins: What the Hell Do They Even Do?
AIA Engineering makes high-chrome grinding media balls, liners, and diaphragms — sexy words if you’re a cement or mining company.
Basically:
- 👷 They supply parts for crushing, grinding, and pulverizing hard materials.
- 🏗️ Customers: Cement, Mining, Thermal Power
- 🌍 Global Reach: 120 countries. If it can be crushed, AIA is probably there.
Oh, and they’re the second-largest in the world for what they do.
2️⃣ The 5-Year Scoreboard 📊
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Sales (₹ Cr) | 2,881 | 3,567 | 4,909 | 4,854 | 4,287 |
| Net Profit (₹ Cr) | 566 | 620 | 1,056 | 1,137 | 1,060 |
| OPM % | 23% | 20% | 25% | 28% | 27% |
| EPS (₹) | 60.0 | 65.7 | 111.9 | 120.4 | 112.5 |
| ROCE | 17% | 17% | 25% | 23% | 19% |
| Stock Price (₹) | ~1,600 | ~1,900 | ~2,600 | ~4,200 | 3,385 (now) |
🧠 Takeaway: Profits have doubled, margins have expanded, and EPS has nearly 2x’d since FY21… but FY25 sales are actually down YoY. Time to panic? Not yet.
3️⃣ Business Wins, Blunders & Bizarre Things
✅ Wins
- 💸 Margins: OPM improved from 23% to 27%. That’s not easy in a casting business.
- 🌍 Export Machine: 70%+ revenues from outside India.
- ♻️ Clean Energy Push: Now 60–70% of power needs to be met via renewables by FY26. ESG bros, rejoice.
❌ Blunders
- 🐌 Working Capital Days: Ball-dragging at 485 days! (vs 263 in FY21). That’s 16 months of cash stuck somewhere.
- 🇺🇸 Anti-Dumping Duty: 4.3% slapped by the U.S. in Dec 2024. Minor now, but a warning shot.
🤨 Weird Flex
- 🎯 China + Ghana Capex: 2 new plants announced (50,000 MT each) for $50M, via UAE subsidiary. Decentralization or distraction?
4️⃣ Growth Drivers: What’s Cooking?
🧪 Trials That Take 2 Years
- Before you get orders, you must test the chrome grade at the mine for 18–24 months.
- But once you’re in — you’re sticky af.
🏗️ Capacity:
- Current: 4.6 lakh MT
- New Plants: China H2 FY26, Ghana ~FY27
🌿 Renewable Energy:
- 70.3 MW installed via wind + solar
- They’re going from chrome to green
5️⃣ Challenges? There Are a Few…
🪫 Sales Are Down
- FY25 saw ₹4,287 Cr vs ₹4,854 Cr in FY24
- But PAT held up thanks to better OPMs
🌪️ Macro Trouble
- Mining orders are cyclical
- Power + Cement demand in India is not booming
📦 Inventory Days Still High
- Over 210 days. Do you need this much stock lying around?
6️⃣ Valuation & Peer Gossip
| Company | P/E | ROCE | Sales Growth (5Y) | CMP (₹) |
|---|---|---|---|---|
| AIA Engg | 30.2 | 19% | 8% | 3,385 |
| Happy Forgings | 34.7 | 19% | 19% | 984 |
| Balu Forge | 35.8 | 31% | 40%+ | 666 |
| Steelcast | 30.0 | 33% | 22% | 1,069 |
📉 Verdict: AIA is trading at a premium, but not an insane one. It’s not the growthiest, but definitely the most global and predictable.
7️⃣ EduInvesting Verdict: “Boring But Billionaire?”
🎯 If you want:
- Global reach
- Margins that don’t yo-yo
- A 25% dividend payout with solid buyback history
Then AIA is the “steady-as-she-goes” metallurgical bet.
But if you crave:
- Hyper-growth
- Hot narratives
- VC-style 3x returns in 1 year
Then lol, please look elsewhere (maybe Synergy Green?).
🏁 TL;DR
- ✅ Profits 2x in 5 years
- ✅ Margins improved big-time
- ✅ Big global expansion via China + Ghana
- ❌ FY25 sales declined YoY
- ❌ Working capital cycle looks like a sloth’s commute
- ⚠️ Long sales gestation + cyclical demand
Still, AIA is a cash-rich, moat-y, and clean-energy embracing grinder in every sense. Just… be patient.
✍️ Written by Prashant | 📅 16 June 2025
Tags: AIA Engineering, Grinding Media, FY25 Results, Renewable Energy Stocks, Exporters, Midcap, Castings Sector, Manufacturing Stocks, EduInvesting 5-Year Recap
