Cochin Minerals & Rutile Ltd Management Discussions

Cochin Minerals and Rutile Limited is a 100% Export-Oriented unit operating in the mineral processing sector, with manufacturing, marketing and research capabilities. The Company manufactures a range of titanium- and iron-based products serving diverse industrial applications.

Products and Applications

Raw Materials

The principal raw materials used by the Company are Ilmenite and Hydrochloric Acid.

Ilmenite is the principal titanium-bearing mineral used for the manufacture of Synthetic Rutile. At the same time, Hydrochloric Acid is the principal process chemical used to upgrade Ilmenite and remove its iron content.

At the time the project was established, the availability of both raw materials from indigenous sources was an important consideration in locating the manufacturing facility in Kerala. The Company has never been engaged in mining operations.

Since 2010, the availability of ilmenite from domestic sources has declined significantly. Consequently, the Company has increasingly relied on imported Ilmenite for the manufacture of Synthetic Rutile, while Hydrochloric Acid continues to be sourced predominantly domestically.

The Company has been making continuous efforts to diversify its sources of ilmenite from various overseas suppliers. Process adaptations have also been undertaken to enable the use of different grades of imported ilmenite while maintaining the required quality of Synthetic Rutile. These efforts to secure reliable and diversified sources of ilmenite will continue.

Opportunities and Threats

Opportunities

Synthetic Rutile remains an important high-grade titanium feedstock for production of various titanium value added products. It is used for production of titanium dioxide pigment, titanium sponge/metal, welding sector and for other applications. The limited availability of natural rutile, together with the requirements of chloride-process pigment production and more specifically titanium-metal applications, supports the long-term relevance of this upgraded titanium feed stock. Opportunities also exist through product differentiation, customer-specific grades and the development of value-added titanium products.

Threats

The Synthetic Rutile industry is closely linked to the cyclical titanium dioxide pigment market, which accounts for the majority of titanium-feedstock demand. Periods of weak pigment demand, capacity rationalization and increased availability of competing feed stocks like titanium slag can exert pressure on sales volumes and realizations. The industry is also exposed to fluctuations in the availability and cost of ilmenite, energy and logistics costs, geopolitical developments, disruptions to international trade and global GDP growth.

Operational Performance

The operational performance highlights of the company for the year 2025-26 are presented below:

The Companys gross income for the financial year ended 31st March 2026 decreased to Rs29,718.90 lakhs against Rs32,741.02 lakhs in the previous financial year, thereby registering a decrease of 9%. The profit before tax decreased to Rs1,892.02 lakhs against Rs3,773.97 lakhs in the last financial year.

The company operates in a single segment

Key Financial Ratios

Outlook

During the year 2025-26, turnover of the company declined by 9% to Rs28,718.59lakhs against Rs31,601.72lakhs of the previous year. The lower sales volume of Synthetic Rutile led to a decrease in the companys turnover. This shortfall stems from a subdued market for Synthetic Rutile caused by an oversupply of alternative feedstock driven by low demand from Pigment sector. The global market is experiencing oversupply of titanium feedstock and there is intense competition from competitors. The surplus availability and low price set by the competitors led to the decline in the price of synthetic rutile. But there has not been a proportional price reduction in our primary raw material Ilmenite. In view of the incompatibility in the prices of synthetic rutile and main raw material, ilmenite and due to decrease in ferric chloride sale, the company is taking various steps to maintain the optimum level of production and sales.

Risks, Concerns and Strength

In the present scenario, companys operations are subject to certain risk factors, primarily related to the pricing of ilmenite, our critical raw material. As we do not engage in mining, we rely on external sources for ilmenite, which poses a challenge. Reduction in price of Synthetic Rutile does not reflect in the pricing of ilmenite and hence results in lower margin. Company is also procuring semi finished product,viz., upgraded beneficiated ilmenite, at a very competitive price.

The domestic supply of ilmenite remains uncertain, necessitating the import of a higher quantity of Ilmenite. Despite these challenges, we are striving to maintain optimal production levels. Our directors actively address the ilmenite shortage by exploring international sources to secure a more stable and sufficient supply. This proactive approach aims to mitigate the risks associated with ilmenite procurement and ensure the continuity of our operations.

The volatility of synthetic rutile market still persists. The Titanium Pigment sector has not yet recovered from the period of market recession, which resulted in decline in both demand and pricing of Synthetic Rutile. Revival of Titanium pigment market in China is crucial for boosting demand for titanium feedstock. The titanium metal & sponge segment is performing well where our premium Synthetic Rutile is primarily utilized. However, an oversupply of titanium feedstock globally has led producers to demand lower prices which in turn resulted in significant decline in both demand and pricing of Synthetic Rutile.

Geopolitical tensions in West Asia disrupted maritime shipping services to Middle East ports, our primary market for Ferric Chloride. Consequently, export shipments were suspended in March 2026, causing total sales to decline to 980 MT for the month compared to the previous average of 2,900 MT per month. A prolonged disruption in this region may pose a significant adverse impact on our ongoing sales volume and manufacturing operations.

The major strength of your company is that its products follow the highest international standards and are well accepted by reputed international buyers. Your company has been granted ISO 9001:2015 by the prestigious agency Bureau Veritas, accredited by UKAS London and NABCB India. Your company has also been awarded ISO 45001- 2018 for safety by the prestigious agency Bureau Veritas, certified by UKAS London and NABCB India. The Company also got certification from N S F International, an organization designated as a Collaborating Center by the World Health Organization (WHO) for our products, Ferric Chloride and Ferrous Chloride with hydrated Titania catalyst and these products conform to NSF/ANSI standard 60 for drinking water treatment.

A skilled and dedicated work force is another strength of your Company.

Health, Safety and Environment

The company gives high priority to issues concerning health, safety and the environment.

Health- The Company aims to provide all employees with comprehensive health services covering protective, preventive and curative health care. Apart from being covered by the Employee State Insurance Scheme (ESI), the employees are also entitled to medical reimbursements under the employees medical beneficiary scheme of the company.

Safety - The Company gives safety of employees the utmost importance. The protection of persons overrides all other considerations. This vision drives the company continuously to look for ways to break new barriers in safety management for the benefit of all. There has not been any significant accident since its inception. Safety awareness programs are regularly conducted for the employees.

Environment - The Company aims to maintain a clean and pollution-free environment. Environment impact assessment and qualitative risk analysis are conducted for all new/major expansion or diversification projects and all necessary safeguard measures are incorporated in to the project. The effluent treatment plants, air emission abatement units, waste treatment/disposal facilities etc., are maintained as per statutory standards. The Company complies with all pollution control and environmental protection regulations. The Company also undertakes various ecological protection programs such as tree planting, water conservation measures, water purification, energy-saving initiatives,etc.

The Company has also bagged an excellence award for 11 years from the Government of Kerala for implementing Pollution Control measures. The companys product, Ferric Chloride, is widely and successfully used worldwide in water purification and effluent treatment. Another product, cemox helps reduce ecological problems by helping to minimize clay mining and as a supplement to the Iron Ore supply.

Internal Control Systems and Adequacy

Your Company maintains formal internal control systems and procedures, which are continuously and strictly enforced. These have been designed to provide reasonable assurance about reliable financial information, compliance with applicable statutes, safeguarding assets and ensuring adherence to the Companys corporate policies. These systems and procedures, which are routinely tested and certified by your Companys statutory and internal auditors and reviewed by the audit committee, are found to be adequate and effective.

Human Resources

Your Company values human resources as the most significant asset and maintains harmonious industrial relations. The company provides adequate employee training and undertakes various employee welfare measures. As of March 31,2026, the company had 215 permanent employees on its rolls.