TRUE GRIT 66 th ANNUAL GENERAL MEETING 29 July 2020 DISCLAIMER The - - PowerPoint PPT Presentation

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TRUE GRIT 66 th ANNUAL GENERAL MEETING 29 July 2020 DISCLAIMER The - - PowerPoint PPT Presentation

TRUE GRIT 66 th ANNUAL GENERAL MEETING 29 July 2020 DISCLAIMER The communication may contain statements relating to future business developments, companys performance and economic performance that may constitute forward looking


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TRUE GRIT

66th ANNUAL GENERAL MEETING 29 July 2020

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The communication may contain statements relating to future business developments, company’s performance and economic performance that may constitute ‘forward looking statements’. While these forward looking statements represent the company’s judgments and future expectations, a number of factors could cause actual developments and results to differ materially from expectations. The company undertakes no obligation to publicly revise any forward-looking statements to reflect future events or circumstances.

DISCLAIMER

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CUMI Incorporated Coated Abrasives facility from Ajax Products Pvt. Ltd. Bonded Abrasives facility set up at Chennai, India. Bauxite mining at Bhatia, Gujarat, India. Manufacture of Super Refractories at Chennai, India. BFA Edapally Calcination facility at Okha EAL, Calcutta. 2nd Bonded Abrasives plant at Hosur, MMTCL Expansion of Bonded Abrasives plant at Hosur, Silicon Carbide plant at Koratty, & Refractories plant at Ranipet. Industrial Ceramics plant at Hosur Acquisition of 40% interest in Wendt (India) Ltd. 12 MW Hydel project at Maniyar, Kerala,

  • India. WFA at Edapally,

Sterling Abrasives Limited, Ahmedabad, Acquired & merged Cutfast Abrasive Tools Limited. CUMI America Inc., USA & CUMI (Australia) Pty Ltd. 5.5MW natural gas based thermal power plant in Nallur, SEDCO. Acquired Prodorite Anti-Corrosives Ltd., Cloth processing facility at Maraimalainagar, Tamil Nadu. TQM drive across the company SiC Microgrits at Koratty , Kakkanad, Sol-gel plant and Alumina Zirconia in Edapally CUMI Middle East. state-of-the-art Coated Abrasives plant at Sriperumbudur Monolithic Refractory facility in Jabalpur Volzhsky Abrasives Works, Russia. 51% holding in Foskor Zirconia (Pty) Ltd, South Africa. Manufacturing facility for Thin Wheels at Uttarkhand. Commissioning of a modern 1,000 tonne Vitrified Bonded Abrasives plant and 2,000 tonne Organic Bonded Abrasives facility in China. Expansion of Industrial Ceramics & METZ 1.0 state-of-the-art Super Refractories plant II at Serkadu Thukela Refractories Isithebe Pty Ltd, South Africa TPM Kickstarted in Abrasives Toll manufacturing model operations commenced in China. Expansion of IC at Hosur METZ 2.0 Commissioned three fusion plants at its Electro-mineral Complex at Cochin, India. 5 of CUMI’s Plants were awarded with JIPM Award for Excellence in TPM Consistency / TPM Excellence, Category ’A’.

1954 - 63 1964 - 73 1974 - 83 1984 - 94 1994 - 04 2004 - 13 2014 - 19

CUMI – A BRIEF HISTORY

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Abrasives Electro minerals Ceramics & Refractories Composites

Materials Science Solutions

Surface Engineering Heat Containment & Management Mission Critical Applications Wear & Corrosion Protection

WE ENGINEER MATERIALS SCIENCE SOLUTIONS FOR AN ENDURING PLANET

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Arul Rajkumar Jayan P S V G Rajendran Rajesh Khanna M M Murugappan

Chairman

N Ananthaseshan

Managing Director

Ninad Gadgil Sergey Kostrov

OUR LEADERSHIP TEAM

Trevor Allen HR Electrominerals Refractories Ceramics Abrasives VAW CAPL

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ABRASIVES HYDEL POWER BAUXITE MINE THERMAL POWER ELECTRO MINERALS CERAMICS; REFRACTORIES COMPOSITES STRONG BACKWARD INTEGRATION DIVERSITY IN SEGMENTS; GEOGRAPHY & CUSTOMERS DIVERSITY IN SEGMENTS; GEOGRAPHY & CUSTOMERS STRONG PEOPLE CAPABILITIES DRIVING INNOVATION STRONG PEOPLE CAPABILITIES DRIVING INNOVATION SURFACE TECHNOLOGY CENTRE 7 DSIR LABS 60 + MATERIALS & TECHNOLOGY PLATFORMS STRENGTHENING THE CORE: BUILDING MATERIALS FOR THE FUTURE STRENGTHENING THE CORE: BUILDING MATERIALS FOR THE FUTURE NEW-AGE MATERIALS DESIGN THINKING APPLICATION DEVELOPMENT ORGANIC & INORGANIC GROWTH OPERATIONAL EXCELLENCE NEW PROCESSES

A RESILIENT ORGANISATION BUILT ON STRONG FUNDAMENTALS

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CUMI

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Standalone Operations Direct Subs Subs via CIL JVs/ Associates

Abrasives Electro Minerals Ceramics Sterling Abrasives Limited – 60% SEDCO - 84.76% Net Access India Limited - 100% CUMI Australia Pty. Ltd. - 51.22% Wendt India Ltd. 39.87% MMTCL - 49% CIRIA Limited - 30% Volzhsky Abrasives Works (Russia)- 98.07% FOSKOR Zirconia (Pty) Ltd. (S. Africa) – 51% CUMI America Inc. – 100% CUMI Middle East – 100% CACCL (China) – 100% CUMI Europe (Czech Republic) – 100%

CUMI GROUP

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GLOBAL FOOTPRINT

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The Year That Was 2019-20

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*IMF’s estimates as of June 2020 Calendar Years are followed for all Economies except India **CSO, MOSPI

20% 6%

  • 16%
  • 4%

4% 0%

  • 13%
  • 11%
  • 20%
  • 15%
  • 10%
  • 5%
0% 5% 10% 15% 20% 25% Q1 FY 19 Q2 FY 19 Q3 FY 19 Q4 FY 19 Q1 FY 20 Q2 FY 20 Q3 FY 20 Q4 FY20

10.7 5.6 5.2 2.1 3.0

  • 0.6
  • 0.8
  • 1.4
  • 4.0
  • 2.0
0.0 2.0 4.0 6.0 8.0 10.0 12.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2018-19 2019-20

6.4 5.2 6.6 6.0 5.2 2.6

  • 0.04
  • 2.2
  • 3.0
  • 2.0
  • 1.0
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2018-19 2019-20

CONSTRUCTION MANUFACTURING

2.3 1.3 6.1 4.2 1.3 0.2 1.7

AUTOMOTIVE

GLOBAL* INDIA**

2019: SUBDUED GLOBAL GROWTH

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551.5 569.1 574.5 620.8 650.8 671.5 688.8 739.6 736.9 3% 1% 8% 5% 3% 3% 7% 0%

  • 1%
0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 0.0 100.0 200.0 300.0 400.0 500.0 600.0 700.0 800.0 2011-12(Apr-Mar) 2012-13(Apr-Mar) 2013-14(Apr-Mar) 2014-15(Apr-Mar) 2015-16(Apr-Mar) 2016-17(Apr-Mar) 2017-18(Apr-Mar) 2018-19(Apr-Mar) 2019-20(Apr-Mar)

75697.0 81690.0 87673.0 92157.0 90980.0 100748.0 106364.0 111780.0 115621.0 8% 7% 5%

  • 1%

11% 6% 5% 3%

  • 2%
0% 2% 4% 6% 8% 10% 12% 0.0 20000.0 40000.0 60000.0 80000.0 100000.0 120000.0 140000.0 2011-12(Apr-Mar) 2012-13(Apr-Mar) 2013-14(Apr-Mar) 2014-15(Apr-Mar) 2015-16(Apr-Mar) 2016-17(Apr-Mar) 2017-18(Apr-Mar) 2018-19(Apr-Mar) 2019-20(Apr-Mar)

229500.0 246614.0 255826.0 270938.0 283457.0 279975.0 297711.0 337322.0 334366.0 7% 4% 6% 5%

  • 1%

6% 13%

  • 1%
  • 2%
0% 2% 4% 6% 8% 10% 12% 14% 16% 0.0 50000.0 100000.0 150000.0 200000.0 250000.0 300000.0 350000.0 400000.0 2011-12(Apr-Mar) 2012-13(Apr-Mar) 2013-14(Apr-Mar) 2014-15(Apr-Mar) 2015-16(Apr-Mar) 2016-17(Apr-Mar) 2017-18(Apr-Mar) 2018-19(Apr-Mar) 2019-20(Apr-Mar)

876950.4 912056.7 967237.8 1110458.0 1173602.0 1242105.8 1308195.7 1375687.7 1388847.9 4% 6% 15% 6% 6% 5% 5% 1%

0% 2% 4% 6% 8% 10% 12% 14% 16% 0.0 200000.0 400000.0 600000.0 800000.0 1000000.0 1200000.0 1400000.0 1600000.0 2011-12(Apr-Mar) 2012-13(Apr-Mar) 2013-14(Apr-Mar) 2014-15(Apr-Mar) 2015-16(Apr-Mar) 2016-17(Apr-Mar) 2017-18(Apr-Mar) 2018-19(Apr-Mar) 2019-20(Apr-Mar)

COAL PRODUCTION (mMT) STEEL (‘000 TONS) CEMENT (‘000 TONS) ELECTRICITY (GEN. Mkwh)

CORE INDUSTRIES IMPACTED

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**CSO, MOSPI

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Revenue EBIT Abrasives** Revenue: INR 995 Cr EBIT : INR 113 Cr Revenue :INR 629 Cr EBIT :INR 132 Cr Revenue :INR 1026 Cr EBIT :INR 104 Cr Financial Year 20 Gross Sales * :INR 2569 Cr PAT :INR 272 Cr Electrominerals** Ceramics & Refractories**

*After inter-segmental cancellations **Before inter-segmental revenues, excludes ‘Other’ segments

32% 38% 30% 37% 39% 24%

  • 11%
  • 19%

1%

  • 19%

4% 22%

CONSOLIDATED FINANCIALS SEGMENTAL RESULTS : FY 20

12

  • 3%

10%

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1,917 2,080 2,330 2656 2575 116 122 143 166 134

  • 200
300 800 1,300 1,800 2,300 2,800

FY 16 FY 17 FY 18 FY 19 FY 20

2569

PAT % 9% PAT 11% PAT: 10% GOLY Sales: (3%) GOLY

1,274 1,383 1,551 1752 1622 116 122 143 166 134

  • 200
400 600 800 1,000 1,200 1,400 1,600 1,800

FY 16 FY 17 FY 18 FY 19 FY 20

PAT % 9% PAT % 12% PAT: 15% GOLY Sales: (7%) GOLY CONSOLIDATED SALES AND PAT IN RS Crores STANDALONE SALES AND PAT IN RS Crores 144 175 216 248 272

1623 191

FINANCIALS

13

2331

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Financial Strength

Return on Equity%

13% 14% 15% 15% 14%

12% 13% 13% 14% 14% 15% 15% 16%

2016 2017 2018 2019 2020

0.3 0.1 0.1 0.1 0.0

0.05 0.1 0.15 0.2 0.25 0.3 0.35

2016 2017 2018 2019 2020

Debt/ Equity

  • 66 years of unbroken dividend

payout

  • Strong and consistent returns on

capital

  • Steady increase in Asset turnover
  • Strong Balance Sheet – Major

expansion plans on internal accruals

  • Zero Net Debt

FINANCIALLY RESILIENT

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PERPETUAL RESILIENCE

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WHAT MAKES CUMI RESILIENT ?

It’s varied Businesses

  • Abrasives, EMD, Industrial Ceramics, Refractories

It’s varied industry segments

  • Auto, Auto comp, Engineering, Basic Metals, Infrastructure, Energy, Power, Housing etc.

It’s varied markets

  • ~45% of the revenues are outside India

It’s cost competitiveness

  • Backward integration, low cost manufacturing presence

It’s culture

  • Openness, Innovation, Experimentation

It’s amazing people !

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Auto & Component Construction General Eng Heavy Eng Bearings Steel Aerospace

High end Applications in Aerospace, Defense, MRO Hubs in India

Core Adjacencies / Transformational

ABRASIVES: ENGINEERING SURFACES

Auto after markets Higher used vehicle sales likely post-covid Infra and Construction Atmanirbhar Bharat (ANB) focus on housing, construction, real estate MREGA allocations Auto Greater Preference for personal modes

  • f transportation

General & Heavy Engineering Overall GDP growth – India growth expected to reach 6% in 2021

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COATED CAPACITY EXPANSION – SRIPERUMBUDUR

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Abrasives Refractories Silicon Wafer slicing Laminates, investment casting , Brakes etc. Diesel Particulate Filters MMC

Semiconductors Black / Green SiC, high purity minerals IoT, digitzation etc.

Core Adjacencies / Transformational

ELECTROMINERALS: WORKHORSE MINERALS FOR INDUSTRY; PERFORMANCE MINERALS FOR FUTURE

Renewables & Energy Storage – Graphene, SiC wafer slicing Electrification of vehicles globally Refractories & MMC Global fiscal stimulus – infrastructure impact on steel, cement, glass etc. Mining boost - ANB Abrasives ‘Regular’ minerals for conventional products ‘special’ grades for high end alloys, high tolerance grinding Plasma Spray Powder & Investment casting Defense & Aerospace push- ANB

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White Fused Alumina Furnace conversion and Refurbishment at Kochi

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VOLZHSKY ABRASIVE WORKS

SiC expansion NbSiC Refractories Securing supply chains

Volzhsky Abrasive Works

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Mining Power Generation SoFC Medical Ceramics Power T&D Automotive

Renewables/ Clean Energy - SOFC Global renewable energy goals

Core Adjacencies / Transformational

INDUSTRIAL CERAMICS: WEAR APPLICATION; CO-CREATED ENGINEERED CERAMICS

Semiconductor Wafers Power distribution Smaller distributed grids, as Renewables increase Iron & Steel Infra & construction push Cement, Mining ANB push on Infra Issue of mining licenses Coal self sufficiency

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CUMI AUSTRALIA PTY LTD.

1

NON OXIDES

2

CAST BASALT

3

RBSIC

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GROWTH : CAPACITY EXPANSIONS, NEW CAPABILITIES

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Metz 2.5 SiSiC NbSiC

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Ceramics Cement Steel Wind Energy Glass Petrochem

Core Adjacencies / Transformational

REFRACTORIES & COMPOSITES : HEAT CONTAINMENT, WEAR, CORRSION RESISTANCE

Composites Wind energy, Railways EV Bodies – light weighting Waste incineration NbSiC Emission norms Flue Gas Desulphurization Emission norms Iron & Steel Infra & construction push Misc Heavy industries: Cement, Glass, Carbon Black Growth to rebound in 2021

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Innovation & New Products

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Flap Discs

NEW PRODUCTS - ABRASIVES

Scrub pad Paper Disc Zr disc

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Defense – telescopic poles Electric Vehicles

NEW PRODUCTS : COMPOSITES

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IoT enabled Predictive maintenance Composite Spray Header Graphene Spherodization

NEW PRODUCTS: CERAMICS, REFRACTORIES, NEW MATERIALS

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NEW PRODUCTS : CERAMICS

Ceramic lined rubber hoses C Channels- SOFC Life style Metal Matrix Composites substrates Paper Cone accessories Metallized Ceramics for X Rays

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People Capabilities

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THE CUMI FAMILY: DIVERSE, VIBRANT

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NETWORKS & INDUSTRY LEADERSHIP

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1 2 3 4

PARTNERSHIPS CUSTOMERS EXPOS INDUSTRY BODIES

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Awards & Recognition

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  • CUMI IC was awarded the CSIR Diamond Jubilee Technology 2018 for the technology of Metallization of

Ceramics on 26th of September 2019

  • CSIR Foundation Day Function was held at Vigyan Bhavan, New Delhi. The function was graced by the

Honorable President of India, Mr Ram Nath Kovind & the Award was handed over to CIMU IC by the Honorable Minister of Science and Technology, Dr K Harsh Vardhan.

CSIR Diamond Jubilee Technology Award for 2018

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AWARDS & RECOGNITION

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IEI Centenary Excellence Award

TPM Significant Achievement Award Sreshta Suraksha Pushkar Award - EMD National Productivity Summit

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AWARDS & RECOGNITION

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SEEM National Energy Conservation Award ICIA and SAFA Awards – financial Reporting

CSR Award from Rotary International

CCSD Hosur, “Best Establishment of the Region, GoI

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CAPABILITY : PEOPLE & INFRASTRUCTURE

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16 8 13

2 4 6 8 10 12 14 16 18

Trademarks Patents Desgin GETs & PhDs Skill Development Design Thinking DSIR Labs / Surface Technology Centre

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Corporate Social Responsibility

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CORPORATE SOCIAL RESPONSIBILITY : HEALTH, EDUCATION & INFRASTRUCTURE

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Health Education Community Education Community Health

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INAUGURATION OF SKILL DEVELOPMENT CENTRE - 2020

Total No. of Students till Mar’2020 : 353 Total No. of pass-outs : 157 Ongoing batch : 196

316 37

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COVID & Post Lockdown

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  • Operations safely restarted post lockdown –

across locations globally

  • Strict adherence to social distancing
  • PPEs, sanitization facilities, and safety gear

provided

  • Communication and Awareness initiatives
Roorkee Kolkata Jabalpur Okha, Bhatia Kakanad (3) Edapally Koratty Manivar Thiruvottriyur Maraimalai Nagar Sriperumbudur Ranipet Hosur (2)

ALL PLANTS OPERATIONAL POST FIRST LOCKDOWN

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ALIGNING OURSELVES TO THE NEW NORMAL

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EMPLOYEES OPERATIONS CUSTOMERS COMMUNITIES

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CAPABILITY EFFICIENCY

1 2 3

Core Metz 2.5 SiC / NbSiC

GROWTH

Maker 2 SiSiC Composites Core PhDs Design Thinking GETs 16 TM 8 Patents Core Digital Automation Cost Reduction IT infra JDPS Tape Casting Magnetic sputtering Skill Development Centre

KEEPING OUR FOCUS TRAINED ON THE FUTURE

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Way Forward : Navigating the Post COVID World

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Pivot Product Portfolio - innovation Strengthen supply chains across global

  • perations

Stakeholder Relationships Employee Productivity enhanced through Automation Health & Safety – Covid Care

1 2 3 4 5

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Strategy Summary

  • Leverage distribution and expand
  • Existing products, existing geographies
  • Adjacencies (Construction Chemicals, Specialty Coatings) in existing geographies
  • Increase market share in global Coated markets through Maker 2.0
  • Pursue inorganic opportunities in complementary products (Vitrified CbN)
  • Improve Utilization in core assets, gain market share in BFA, Semi-Friables, SiC
  • Drive costs down through operational efficiencies, and by increasing market share
  • Ramp up Specialities through product and application development- CUMI Blue,

Synthetic Brown Fused Alumina, Alumina Zirconia

  • R&D and capex focus on ‘New Age Minerals’
  • Expand product offerings to Core industries – Mg based

products, and Flow Control products

  • Drive marketing and production synergies between VAW and

Indian operations

  • Expand product offering to Core

industries (Cast Basalt, Wear Plates)

  • Break-out growth in 1) Non-oxides 2)

Composites 3) Semi-conductor substrates & wafers 4) Medical Ceramics

  • Explore Inorganic opportunities

Materials & Processing Capabilities Cost Position Distribution Reach Strong Balance Sheet & Cash Flow Customer-centric product development

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Thank You