AIA Engineering Ltd

LETTER FROM MANAGING DIRECTOR'S DESK

We have continued to work closely with our customers seeking to be long term Partners of those businesses where we can make the most meaningful difference

Dear shareholders,

The Financial Year 2020-21 was dominated by COVID-19 and it continued to test our individual and collective resilience. The health, safety and well-being of people has continued to be at the heart of our COVID-19 response. Being a Global Company providing critical solutions to diverse customers in more than 120 countries of the world in the Cement Segment and to more than 35 countries of the world in Mining Segment, it was the key focus area of the Company to ensure that there was no disruption in the supplies of our products and services to our customers, and I am happy to share that we have proved our resilience by ensuring that in spite of the challenging times where there were severe international travel restrictions for a major part of the year, there was no disruption from our side in fulfilling our supply commitments to the customers.

The year gone by was a challenging year by all the measures. While we seem to have come out of the second wave of the pandemic, the threat of the third wave is looming large in front of us. However, optimistically we feel that we should be able to face the third wave without causing any serious disruptions given the fact that the World is now seemingly much better equipped, having accepted the fact that continued recurrence of COvId-19 pandemic in medium to long term will be the "new normal" with which we all will have to learn to live on an ongoing basis.

Alongside the ongoing challenges of managing the pandemic, COVID-19 has accelerated sharper focus to respond to the longer-term trends impacting our business and ensuring that we could better adapt to the ongoing change and hope for a better tomorrow. Our strengths in metallurgy, designing, massive global footprint and skilled talent base remain the core reason for our growth amidst the challenging times. As you all may be aware, we have developed a comprehensive solution portfolio for taking care of grinding and crushing needs of the Global Cement and Mining Industries, with the later posing a massive opportunity of converting the mining companies worldwide from their conventional forged grinding media based solutions to the Hi-Chrome based solutions offered by the Company. There is a significant headroom available for conversion which is the core area of focus of our Company and we believe that we are now fully equipped through our multifaceted solutions portfolio to convert a large number of mines into Hi-Chrome use and thus gain a dominant market share over a medium to long term horizon in this space. The golden triangle: Application, Metallurgy and New Product Development help us deliver the exact need of our clientele. It also helps us reduce the operational costs and limit our environmental impact, which drives us towards fulfilling our main goal.

On the ongoing projects' front, the Company is setting up a manufacturing plant of Mill Liners with 50,000 Mt with an estimated CAPEX of Rs. 250 Crores. The Company's total installed capacity will be increased to 4,40,000 TPA from the present installed capacity of 3,90,000 TPA. Given the massive opportunity of growth in front of us, we will be continuously going on with new Capex plans for capacity augmentation. However, as we have been doing in the past, a bulk of it will continue to be financed through our internal accruals only - given a comfortable balance sheet and surplus cash position that we have been maintaining.

The Company has always believed in giving back to the society, and through its sustainable measures, the Company actively contributes to the Social, Economic and Environmental Development of the community in which the Company operates ensuring participation from the community and thereby creating value for the nation. It ensures socioeconomic development of the community through different participatory and need-based initiatives in the best interest of the poor and deprived sections of the society so as to help them to become self-reliant and build a better tomorrow for themselves. It also ensures the environmental sustainability through ecological conservation and regeneration, protection & regrowth of endangered plant species and promoting biodiversity.

Going ahead, we would continue to increase our focus on strengthening the total solution capabilities through our extensive and fully equipped R&D team. During the year, we also focused on improving productivity and employee morale, helping them adapt to the evolving time, the new regular post the pandemic.

With this note, I would like to thank all our stakeholders, investors, bankers, customers, suppliers and Government/Regulatory bodies for standing with us during the unthinkable situation happening around the globe. We promise to deliver value to all associated with us through ethical, sustainable and profitable means.