ELGi: Marching towards global leadership in air compressor technology

ELGi Equipments Limited, headquartered in Coimbatore, is the 7th largest manufacturer of air compressors in the world. The company with a comprehensive range of innovative compressed air systems, has earned the worldwide distinction of having designed sustainable solutions that help companies achieve their productivity goals. The Indian MNC’s goal is to become the No.2 air compressor manufacturer in the world by 2027. P.K. Balasubbramaniian converses with Ramesh Ponnuswamy, Executive Director, ELGi Equipments Limited, to understand the dynamics of the air compressor industry vis-à-vis ELGi’s thrusts to achieve the ambitious goal it has set for itself. Excerpts:

Q. What’s the standing of ELGi in the global arena?

ELGi is the 7th largest air compressor manufacturer by revenue terms. ELGi sells its products in over 100 countries. In the fiscal 2017-18, our revenues crossed USD 230Mn.

Q. What’s your range of manufacture today? Is it comprehensive enough to meet the requirements of all major industry segments?

ELGi has the complete range of air compressors across reciprocating and screw types; for both portable and stationary applications. It’s quite a comprehensive range.

Q. What are the dynamics of the Indian air compressor industry and what measures do you take to stay ahead?

ELGi is one of the five companies in the world to design and manufacture oil-free air ends

The Indian air compressor industry is about USD 600 Mn and growing at 5-7% annually. While international players have been active in the Indian market for many years, in recent years there has been an increase in the number of foreign players / brands, especially for screw air compressors. This is for both oil-flooded and oil-free segments.
ELGi’s products are bench marked for performance and quality with the best in the world and we strive to be better than the best. ELGi’s products operate at the lowest life-cycle cost giving our customers the best value for money. We strive to keep abreast of industry trends and introduce products in line with emerging customer requirements, this helps us to stay ahead in the market place.

Q. There was a lull in the textile industry recently. The automobile sector is just picking up. How do you do the balancing act?

ELGi’s products are present in several industry segments. Adverse business cycles in one or two segments, while impacting our performance in those segments, do not therefore affect us significantly in an overall context.

Q. What is your brand promise and differentiated offer to the customer?

Our brand promise is “Always Better”. This is reflected not only in the performance of our products but the way our customers experience it in every possible touch point. Our products have the lowest total cost of ownership and we offer warranty programs that are the best in the industry. This differentiates us in the market.

Q. How are you heading with your global aspirations, also considering your recent strategic moves?

Our presence in key global markets such as US, EU, Australia, etc. is growing at a healthy pace year after year. We are considering both organic and inorganic growth options.

Q. You recently launched your oil-free compressors in the US market. What’s its significance?

Oil-free compressors are among the fastest growing segments of air compressors, considering increasing regulations in many industries that use compressed air. This has resulted in a shift in buying decision by customers from oil lubricated to oil-free compressors. The US market is a very attractive market given its size and the market dynamics offer good prospects for our products. We had to expand our product range in the US market and introducing our oil-free range in that market is a natural progression.

Inside Out: ELGi’s production facility spells world-class

Q. How are you geared to meet the challenges posed by the market which is highly discerning & demanding?

We are focused on innovating continuously to stay ahead of the competition. This is both on the product side and market side. Our approach to product management and work in the front end are geared to respond effectively to meet emerging challenges in the marketplace.

Q. What’s your success rate in educating the customer on energy saving in compressor usage?

We actively engage with our customers in selecting the right compressor – the power rating of compressor selected has to be matched to their compressed air needs in terms of flow and pressure. Where appropriate, we actively educate and promote customers to use products with VFD to save energy cost. We also offer VFD retrofits post-installation and establishment of actual air demand.

We conduct air audits to check compressed air distribution, usage and performance of compressors in customer’s facilities. These audits are focused on providing value added inputs to our customers to minimize energy losses and improve overall efficiency. The audits also help in planning for capacity enhancement if appropriate.

Q. You claim to design sustainable solutions to help companies achieve their productivity goals and keep the ownership cost low. Could you elaborate this?

Our machines have the least oil discharge into the atmosphere thus, reducing the impurities.
We also take pride in designing the machines for reducing wasteful use of energy or systemic leakages of energy. This ensures that the energy cost, which is the largest component of the Life Cycle Cost of a compressor, is kept at the minimum.

Q. How would you summarize your major strengths and capabilities?

50+ years of manufacturing air compressors, since 1960
Full-fledged R&D facilities to ensure continuous innovation
We are one of five companies in the world to design and manufacture proprietary oil-free air ends
We offer end-to-end compressed air solutions with 400+ compressed air systems
Presence in more than 100 countries
Best-in-class Lifecycle Cost (LCC)
Cost leadership