Grinding its Way to the Top

AIA Engineering operates as part of a duopoly that manufactures high chrome mill internals (HCMI) - a superior substitute of the traditionally used forged-steel grinding media in cement, steel plants and mining companies. The barriers to entry in this industry are high - based not on technology but on customer relationships. To add to its strength, lower manufacturing costs give AIA margins higher than its global competitors. Selling to the core sector comes with its share of risks. AIA's two main user industries - mining and cement - are both down. The fall in global demand has resulted in cutbacks in production. While AIA's top line could be under pressure, it has a couple of things going in its favour. First, it is debt-light. To wade through tough times, AIA has the cushion of

This article was originally published on July 07, 2015.