Production for 3Q19 and 9M19 is higher than sales by 15k\/32k (vs historical trends of 2-5k) as there have been delays in offtake by customers. The production is based on orders received from the customers and hence management is confident that sales despatches would pick up over the next 2-3 quarters, driving an uptick in sales and normalised inventories. (1) AIAE has cut its FY19 incremental volume guidance to 20-25 kilo tonnes (from 40-50) due to customer delays in volume offtake. However, it maintains volume guidance of incremental 40-50 kilo tonnes each year led by market share gains in the mining segment (2) Vale\u2019s production cut of 40-50 mtpa unlikely to have an impact as AIA has not yet seen any slowdown; we note that Vale contributes to 6% of FY19E volumes (3) EEMS collaboration continues to yield gains and AIA expects to deliver its first order for a gold mine in Q121. (4) FY19\/20E capex of `230 crore\/`500 crore for expansion to 490 kilo tonnes (Rs 156 crore YTD capex) (5) 4 Wind Mills (2.1 MW each) installed at Rs 52 crore, while balance 4 have been ordered and will lower power costs in FY21 (6) Capacity expansion: 50k in 4Q19, another 50k & 50k mining liner by 1Q21. Read Also| In Asia's high-yield bond battle, Indonesia set to gain upper hand over India once again AIA has seen market-share gains in 3 mt grinding media business in mining with its \u2018total solutions\u2019 approach. The EEMS collaboration is likely to strengthen AIA\u2019s competitive strength and value proposition further and drive faster conversion in mining segment. While near-term volumes are being impacted by slower offtake, we believe the strong value proposition will continue to drive volumes. Accordingly, we estimate 14% volume CAGR would translate into 17% earnings CAGR over FY18-FY20E as margins to see 140 bps expansion to 23.3% on enhanced pricing & cost efficiencies. We believe valuations will remain rich at 26.5x FY20E earnings, considering the long-term structural growth drivers (likely upside on volumes, margins) & oligopolistic nature of the industry. Outperformer. Management reduced its volume guidance of incremental volumes in FY19 from 40-50K to 20-25K due to delays in pickup of volumes from customer end.