Macro Environment and Industry Trends

The global economy remained resilient through 2025, despite an uncertain global environment. Yet there are growing investments in certain high-technology sectors and steady industrial activity in select regions of the world.

Against this backdrop, India sustained its position as one of the world’s fastest-growing major economies, driven by robust domestic demand, sustained infrastructure push and ongoing manufacturing expansion. Policy support through Production-Linked Incentive schemes and localisation programmes, combined with investments in clean energy, railways, electronics and semiconductors, continued to reinforce India’s stature as both a production and consumption hub, sharpening the country’s long-term industrial competitiveness.

These developments are widening the opportunity landscape for the materials and engineering sector, particularly across renewable energy, power systems, electronics, electric mobility and other specialised applications. As industries increasingly demand solutions that fuel performance, reliability and application-specific value, CUMI remains well-poised to address these changing requirements through enhanced market relevance and greater alignment of its portfolio with emerging opportunities across domestic and international markets.

Year in Review

CUMI’s performance during the year reflected disciplined execution, an improved product mix and continued investments in building capabilities. The Company undertook its highest-ever capital expenditure programme, with consolidated capital expenditure of ?3,094 million and standalone capital expenditure of ?2,352 million. These investments were directed towards strategic growth platforms, including Thin Wheels production in Abrasives, ceramics for Semiconductor Equipment, Aerospace and Defence applications in Industrial Ceramics, Fused Alumina capacity expansion and materials for Solid Oxide Fuel Cells in Electrominerals.

Leveraging these targeted initiatives, the Company fortified its technology base and positioned CUMI to address high-value opportunities across materials science, clean energy, electronics, power systems and specialised industrial solutions.

This strategic focus translated into steady business performance. The Company’s consolidated revenue increased by 7% to ?51,494 million, while standalone revenue grew by 9% to ?30,244 million, buoyed by sound momentum in Ceramics, healthy export performance in Electrominerals and an improvement in Abrasives during the second half of the year.

The India businesses continued to operate in a challenging environment, characterised by demand volatility, import-led pricing pressures and changing global market dynamics. Through focused market interventions, prudent cost management and application-led solutions, CUMI sustained operational resilience while maintaining a net debt-free standalone position and generating healthy free cash flow. These outcomes reflect the strength of the Company’s operating model and its continued commitment to disciplined capital allocation and long-term value creation.

Exports remained an important contributor to growth during the year, supported by sustained competitiveness across key product lines and the ability to serve diversified global markets.

This resilience has been driven by continued investments in capacity expansion, technology upgradation, digitalisation and sustainability initiatives, thereby augmenting operational efficiency and aligning the capabilities with evolving customer requirements across geographies.

In line with the focus on disciplined capital allocation and portfolio optimisation, CUMI undertook a strategic review of select businesses. This led to the initiation of voluntary winding-up of CUMI AWUKO Abrasives GmbH in Germany.

Following a review of the commercial viability of Foskor Zirconia (Pty) Ltd. by its Management and Board, it has been determined that the company is no longer in a position to continue operations and that no viable alternative currently exists. The shareholders of Foskor Zirconia (Pty) Ltd. are undertaking a strategic review of the situation, and the outcome will be communicated in due course.

Segment Performance Review

Abrasives

The Abrasives business reported consolidated revenue of ?22,706 million, registering a growth of 5.1% over the previous year’s revenue of ?21,594 million. Segment Profit Before Interest and Tax (PBIT) stood at ?966 million.

The business operated in a challenging environment during the first half of the year due to subdued retail demand, inventory corrections and import-led pricing pressure. Market conditions improved in the second half, supported by stronger industrial demand and focused market initiatives.

The business strengthened its presence across the Industrial, Precision and Retail segments through broader market reach, deeper application support and wider channel expansion.

During the year, CUMI commissioned a state-of-the-art Thin Wheels manufacturing facility at Hosur, equipped with production lines, including technology acquired from DRONCO GmbH, Germany. This strategic investment expands the Thin Wheels manufacturing capacity and supports future growth.

The associate and subsidiary companies contributed steadily to the overall performance. Sterling Abrasives Limited maintained moderate growth, aided by industrial demand and specialised applications, while Wendt (India) Limited maintained stable performance in precision grinding solutions alongside the expansion of its customised tooling and super abrasives portfolio.

RHODIUS Abrasives GmbH improved its precision cutting and grinding offerings despite weak European demand. CUMI America Inc. expanded application support across the industrial segment in North America, while Volzhsky Abrasive Works maintained operational continuity amid evolving geopolitical conditions.

The overseas subsidiaries operated in a challenging global environment marked by weak demand, logistics disruptions and tariff-related uncertainties. Across these markets, the focus remained on selective growth, operational efficiencies and fortifying differentiated capabilities to augment the long-term competitiveness of the global abrasives platform.

Electrominerals

The Electrominerals business reported consolidated revenue of ?16,318 million, registering a growth of 3.7% over the previous year’s revenue of ?15,736 million. Segment Profit Before Interest and Tax (PBIT) stood at ?909 million.

The Electrominerals business delivered accelerated growth during the year, supported by higher exports, an improved product mix and a rising contribution from value-added offerings.

Building on these favourable conditions, CUMI strengthened its position through integrated manufacturing, process discipline and a decisive shift towards specialised, high-purity materials. This was further reinforced by targeted investments in furnace upgrades and treated alumina facilities, enabling a stronger focus on differentiated, value-added growth.

This emphasis on long-term value creation guided the portfolio decisions as well, leading to a continued review of business performance across entities.

VAW, our Russian subsidiary, delivered a resilient performance in its first full year of operations following its inclusion on the OFAC Specially Designated Nationals (SDN) list. Despite restrictions that limited its addressable markets largely to Russia and the Commonwealth of Independent States (CIS), the subsidiary remained profitable through focused operational improvements and disciplined cost management. This performance reflects the team’s ability to adapt effectively to a challenging operating environment.

Overall, the business maintained focus on continuity, specialty product development and execution discipline, while fortifying collaborations with research institutions and technology partners to drive innovation in next-generation materials.

Ceramics

The Ceramics business reported consolidated revenue of ?12,680 million, registering a growth of 9.3% over the previous year’s revenue of ?11,601 million. Segment Profit Before Interest and Tax (PBIT) stood at ?2,562 million.

Industrial Ceramics

Industrial Ceramics delivered healthy growth during FY 2025-26, supported by strong demand for Engineered Ceramics and Metallised Ceramics across clean energy, power systems, electronics and semiconductor manufacturing equipment applications.

Demand for metallised ceramics, vacuum interrupter components and engineered ceramic solutions remained strong, supported by investments in power infrastructure, electronics and fast-growing digital ecosystems. Engineered ceramics for Solid Oxide Fuel Cell (SOFC) applications also recorded encouraging growth during the year.

To strengthen the Company’s participation in these high-growth areas, dedicated facilities were commissioned for advanced ceramic components serving semiconductor manufacturing and defence applications, while expanding application-led partnerships across key international markets.

These initiatives augment the capabilities in high-performance ceramics and position the business to capture opportunities linked to semiconductor manufacturing, electronics, clean energy and precision engineering.

The Company’s international operations complemented this momentum by extending the global reach in engineered ceramics. CUMI America Inc. widened its presence in wear ceramics in North America, while CUMI (Australia) Pty Ltd. continued to grow its engineered wear solutions business, serving customers in mining, mineral processing and power generation, among others.

Super Refractories

The Super Refractories business operated in a mixed demand environment during the year, with conditions improving in the second half as industrial activity recovered across select sectors. Demand from glass, chemicals, fertilisers, petrochemicals and other industrial segments supported business performance.

To strengthen its market position, the business expanded its capacities in corrosion protection, advanced composites and specialised high-temperature applications through focused investments in process improvements, automation and the Integrated Manufacturing Excellence (IMEx) programme.

Improved application engineering, installation, maintenance and lifecycle support further strengthened its position as a solutions-led partner across key customer industries.

The international operations complemented these capabilities, with Silicon Carbide Products LLC, USA expanding its presence in advanced Nitride Bonded Silicon Carbide (NBSiC) solutions for demanding industrial applications.

The outlook for the business remains positive, supported by investments in industrial infrastructure, energy systems, chemicals, glass, defence and other process industries that require high-performance refractory, corrosion protection and thermal management solutions.

Performance of Other Businesses

The Company’s subsidiaries, associate companies and joint ventures continued to drive diversification, technology development and strategic capability.

Murugappa Morgan Thermal Ceramics (MMTCL) Limited continued to strengthen its presence in thermal insulation and passive fire protection solutions. Meanwhile, CIRIA India Limited enhanced its end-to-end refractory engineering and project services capabilities across refinery, petrochemical, fertiliser, hydrogen and other high-temperature process industries.

Net Access India Limited continued expanding its presence across managed services, cybersecurity and digital infrastructure solutions.

PLUSS Advanced Technologies Limited recorded healthy growth, gaining traction from rising demand in healthcare, cold-chain logistics, thermal energy management and specialty polymer applications.

Across their respective markets, the associate businesses and joint ventures stayed focused on disciplined execution, innovation and long-term value creation.

Strategic Priorities and Organisational Transformation

Aspiration 2030 continues to guide CUMI’s long-term growth, providing a strategic framework to strengthen its core businesses while creating new engines of growth.

It is built around seven pillars covering organisational performance, business growth, materials science and innovation, new growth frontiers, manufacturing excellence, sales and marketing, and cross-organisational initiatives such as Digital and ESG.

Together, these pillars are helping CUMI build a high-performance culture while driving focused execution, stronger capabilities, sound governance and a sharper focus on specialised materials and global markets.

CUMI’s integrated business model complements this strategy by ensuring greater control across the value chain, from raw material sourcing to engineered applications. This structure guarantees quality, reliability and speed to market and has been fortified this year through the Integrated Manufacturing Excellence (IMEx) programme that leverages automation, digitalisation and energy optimisation.

Combined with targeted investments in customer-centric innovation, technology expertise and production platforms, these operational advances ensure CUMI is well-positioned to meet evolving market needs.

Environmental Sustainability

The Company continues to embed environmental sustainability across its operations to drive resource efficiency and long-term resilience.

This year, focused investments in cleaner technologies, process improvements and operational discipline empowered the Company to meet the FY 2026 water intensity reduction target, while surpassing its greenhouse gas reduction goal. Waste intensity reduction remains a focus area for improvement.

Capitalising on the broader momentum, CUMI has established more ambitious Aspiration 2030 targets, with FY 2024-25 as the new baseline.

Over this next phase, the aim is to achieve an additional 20% reduction in water intensity, a 25% reduction in greenhouse gas and waste intensity, and an increase in renewable energy to 50% of total power consumption.

These commitments secure CUMI’s trajectory towards building a more resource-efficient, low-carbon and future-ready enterprise.

People and Culture

People are at the core of CUMI’s growth, which is why the Company invests in aligning leadership behaviour with strategic capability.

This year, CUMI embedded this focus by launching the BEFASt Code. Built on the principles of Bold and Timely decision-making, Embracing Change with a solutions-driven mindset, Fairness to all Stakeholders, Accountability in decision-making and execution, and Standing Up for each other, BEFASt is fostering a culture of agility, collaboration and superior performance, rooted in responsibility and trust.

The Company also continued to develop technical and functional capabilities through structured learning programmes, cross-functional projects and training initiatives.

Safety remained a key priority, supported by improved shopfloor systems and behavioural safety practices across operations.

Recognising that operational excellence relies on a thriving workforce, CUMI expanded its wellbeing initiatives across physical, mental, social and financial dimensions under the brand name CUMI Vital.

This synchronised focus on leadership depth, technical capability and holistic wellbeing ensures the Company is prepared to scale into new growth frontiers.

Corporate Social Responsibility

The CSR philosophy focuses on driving inclusive development by creating sustainable impact within the communities CUMI serves.

During the year, CUMI strengthened this commitment through targeted initiatives in education, healthcare, skill development, environmental sustainability and community wellbeing.

By aligning resources with these long-term social priorities, the Company’s interventions address local needs in a practical and lasting manner.

Governance

Governance remains fundamental to the way CUMI operates and creates value. As the Company expands across global markets and specialised applications, it continues to uphold the highest standards of ethics, transparency and accountability.

During the year, the Company further strengthened its governance framework by enhancing risk management, internal controls and cybersecurity oversight, while the Board provided strategic guidance on portfolio choices, sustainability, digitalisation and growth priorities.

To further enrich this leadership depth, Ambassador D. B. Venkatesh Varma joined the Board as an Independent Director, bringing valuable experience and strategic perspective to the organisation.

I wish to place on record my sincere appreciation to the Board of Directors. They have been generous with their time, guidance and counsel, particularly at critical junctures.

The Managing Director, Mr. Sridharan Rangarajan, the leadership team and employees across CUMI, its subsidiaries, associates and joint ventures have contributed immensely across every facet of the Company’s operations with unwavering dedication, determination and selflessness. I extend my sincere thanks and deep appreciation to them.

The Company expresses its gratitude to all shareholders for their continued support as it moves forward with confidence in Strengthening the Core and Steering Growth!

Warm regards,

M. M. Murugappan
Chairman