• �Q � REFRACTORIES LIMITED

Head & Corporate Office

3, Netaji Subhas Road, Kolkata - 700 001, India Phone: +91 33 40106100, Fax: +91 33 22430886 E-mail : ifgl.ho@ifgl.in, Websites: www.ifglref.com

28th February, 2022

National Stock Exchange of India Ltd

BSE Limited

'Exchange Plaza', C-1, Block - G

Phiroze Jeejeebhoy Towers

Bandra - Kurla Complex

Dalal Street

Bandra (E), Mumbai 400 051

Mumbai 400 001

Code : IFGLEXPOR

Code:540774

Dear Sirs,

Re: Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015

In compliance of above, please find enclosed herewith transcript of Earnings Conference Call on Company's financial performance for Q3/FY2021-22 held on Wednesday, 16th February, 2022. A copy of this is also being hosted on Company's Website: www.ifglref.com.

Thanking you,

Yours faithfully,

For IFGL Refr actories Ltd.,

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(RAgarwal) Company Secretary

Encl: As above

Registered Office & Kalunga Works

Sector 'B', Kolungo Industrial Estate

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P.O. Kolungo - 770 031, Dist. Sundergorh, Odisho, Indio

Phone: +91 661 2660195, Fox: +91 661 2660173

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E-mail : ifgl.works@ifgl.in, CIN : L5l 909OR2007PLC027954

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"IFGL Refractories Limited

Q3 FY2022 Earning Conference Call"

February 16, 2022

ANALYST: MR. NAVIN AGARWAL - HEAD, INSTITUTIONAL EQUITIES - SKP SECURITIES LIMITED

MANAGEMENT: MR. KAMAL SARDA - DIRECTOR & CHIEF EXECUTIVE OFFICER - IFGL REFRACTORIES LIMITED

MR. JAMES MCINTOSH - MANAGING DIRECTOR - IFGL REFRACTORIES LIMITED

Page 1 of 14

IFGL Refractories Limited

February 16, 2022

Moderator:Ladies and gentlemen, good day and welcome to the IFGL Refractories Limited Q3 FY2022 Earnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal for an operator by pressing "*" then "0" on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Navin Agrawal, Head of Institutional Equities at SKP Securities Limited. Thank you and over to you Sir!

Navin Agrawal: Good afternoon ladies and gentlemen. It is my pleasure to welcome you on behalf of IFGL Refractories Limited and SKP Securities to this financial results conference. We have with us Mr. James McIntosh, Managing Director and Mr. Kamal Sarda, Director and CEO. We will have the opening remarks from Mr. Sarda followed by a Q&A session. Thank you and over to you Mr. Sarda!

Kamal Sarda: Thank you. Good evening, ladies and gentlemen. Thank you for joining us on the IFGL Refractories Limited Q3 FY2022 earnings conference call. I hope you and everyone around you are safe and in good health. Along with me on the call for the first time, we have Mr. James McIntosh, our Managing Director. James has been appointed as the Managing Director in September. Before becoming Managing Director, he was our President of our US subsidiary EI Ceramics and MCI. Also on the call, we have SGA, our investor relation advisors. We have uploaded the results and presentation on stock exchange and I hope everyone had a chance to go through the same. I would now request Mr. James McIntosh to give a brief overview. Over to you James!

James McIntosh: Thank you Kamal. Good evening, everyone. It is a pleasure for me to interact with you all for the first time. Let us now share a few of the business highlights for the quarter. As we all know, steel is one of the most recyclable materials and existence here in India. Our domestic steel production has witnessed very strong demand growth in the past few years, which will continue for the long term. In support of this statement, I think one of the most important matrices is the per capita steel consumption for India, which is 34% of the world average and only 14% of China average. We have also in recent times seen a very strong bounce as many of the world economies bring back to normal after the last one and a half years of being impacted by the COVID-19 pandemic. Again, you all know that refractories are a key product used in steel making process and therefore we have also witnessed strong demand in our products worldwide, however, at the same time challenges to the supply chains have caused significant escalation in our costs of raw materials and services throughout the world. This has led us into a situation and we were compelled to increase pricing for our products and services to maintain our position at related to these unprecedented increases. Due to the strong relationships we enjoyed with our customers, we have got great support worldwide and I think all of the price increases that we have requested have been granted by the customers, which is a good situation to be in. We would point out, in all of these cases there is a

Page 2 of 14

IFGL Refractories Limited

February 16, 2022

time lag, which exist between the impacts of cost increases to the company. The realization of the actions is acquired by the company and the actions that we take unless although our revenue increased on a standalone as well as our consolidated level as you can see in the figures. Our profitability was affected and on account of these increased expenses some countries fared better than others. We will see a normalization of our profitability levels in the coming months as the price realization that we have requested from the customer catch is all because increase in the operating expenses were higher in the overseas subsidiaries as compared to our domestic business. The rate of global logistics element and their business cycles hence the negative impact to profitability was higher in those subsidiaries as compared to the domestic business so to recap. We see a continuing growth in our revenue with an improvement in our income during the coming months and beyond. Now first let me now hand over to Mr. Kamal Sarda for his comments.

Kamal Sarda: Thanks. Let me give you a short brief on the capex. In FY2023, we planned to spend about Rs.10 Crores in our Odisha plant and also in our Kandla plant. At Visakhapatnam, the phase one where we have already announced the commercial production. The phase two expansion, we are talking of spending about Rs.20 Crores and it should be completed by FY2023. Our focus remains to complete these capex and projects in a time-bound manner and continue ramping up our existing capacities. We expect the demand for the refractories to be steady and growing with the continuous unlocking of the economy. With the enhanced capacities and new product capabilities, we expect to improve the scale of the business, which will lead to scale benefit and operating cycle playing out in the long term of the company.

Let me give you a brief of the financial highlights. On a standalone basis, the total income increased by 8% year-on-year to Rs.196.5 Crores. Sequentially, it was down by 2%. EBITDA was down by 19% to Rs.35.1 Crores. EBITDA margins stood at 17.9% compared to 23.8% in Q3 corresponding quarters. However, it increased from Q2 FY2022 margin of 17.1%. PAT was also down by 29%. On the consolidated financials, these include our international subsidiaries in US and Europe. The total consolidated income increased by 6% year-on-year to about Rs.317 Crores. Consolidated EBITDA was down by 34% and consolidated EBITDA margins were at 12.4% in Q3 FY2022 as compared to 19.9% in Q3 FY2021. PAT was also sequentially down.

With respect to the liquidity positions, we remain net debt free with a very strong cash balance in our balance sheet. Cash balance stood at about Rs.267 Crores as of December 2021 on a consolidated level. I think I now leave for any question and answers. Both James and I will be happy to answer. Thank you.

Moderator:Thank you very much Mr. Sarda. Ladies and gentlemen, we will now begin the question-and- answer session. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Subham Agarwal from Aequitas India. Please go ahead.

Subham Agarwal: Thank you for the opportunity. Good evening team of IFGL. Sir, my first question is slightly at the macro end. If we see the Chinese production of steel, which is going down year-on-year and they

Page 3 of 14

IFGL Refractories Limited

February 16, 2022

have already mentioned that they can reduce substantially the steel production this year. What I

wanted to understand in this context is how does the refractory industry get impacted because of

the Chinese refractory players? There is a hypothesis which says that there may be a huge amount

of spare capacity in Chinese players and because this is not a high-power intensive company, they

may dump product in various other countries so I wanted to know given in context that our 60%

of revenue is global, so how does it impact us and your views will be appreciated around it?

Kamal Sarda:

James.

James McIntosh:

I think that the Chinese refractory companies have been very aggressive for many years in the

global scale. Certainly, and most of our markets that are Chinese refractory suppliers. Our product

area, we have a very great advantage at the moment on the performance side of the products. Our

objective for the future is to look at ways that we can increase our technology and increase the

performance of the products in the future obviously to combat that, but generally speaking I would

say that the Chinese suppliers are already very, very strong worldwide and I do not think the effect

of the Chinese market will be such that it is going to make a major effect on the global scale. Kamal

what are your thoughts?

Kamal Sarda:

I agree with you James. On the power front what you mentioned it is not so power intensive as far

as refractory industry is concerned but the real impact would be on the raw material side, which I

think will be impacting the refractory industry both worldwide not only in China, but also

worldwide, but the situation has eased up over the last few months, so the situation is not bad as it

used to be projected in the month of October and November last year so the situation has eased up.

On the Chinese competition, we do not think that the competition which we should worry about

that has been there for ages now and that will continue to remain there. It is only the technology

front, which will make us different.

Subham Agarwal:

Fair enough. Sir do we have any ADD in US and Europe against Chinese import as of now?

Kamal Sarda:

You are talking of antidumping duty.

Subham Agarwal:

Yes?

Kamal Sarda:

Yes.

James McIntosh:

Yes, we do in America.

Subham Agarwal:

Fair enough and secondly coming to the raw material part, how much of our raw material do we

import from China?

Kamal Sarda:

On a quantity term, it would be around 50%.

Subham Agarwal:

60%?

Page 4 of 14

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IFGL Refractories Ltd. published this content on 28 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 February 2022 12:54:03 UTC.