ELGi Equipments Ltd, a leading air compressor manufacturer, is set to roll out cost-effective, high-performance products next financial year to counter the rising dominance of Chinese imports in the low-value segment.
The company is facing challenges from imported low-kilowatt screw compressors. Many customers who previously used piston compressors find standard screw compressors from ELGi and other global brands in India too expensive. However, more customers are now switching to screw compressors, as Chinese companies flood the market with low-cost options, increasing demand..
If pricing were based on fair costs, competing with Chinese products wouldn’t be a concern. However, a lack of transparency in their pricing adds to the challenge, the company had earlier stated.
Premium segment sails
To tackle this, ELGi has developed a range of low-cost compressors that promise superior reliability, efficiency, and competitive pricing. “These products will not only disrupt the market but also address price concerns posed by Chinese manufacturers,” Jairam Varadaraj, Managing Director of ELGi Equipments Ltd told businessline.
Despite a decline in overall market share due to competition in the lower segment, ELGi has maintained its stronghold in the premium oil-lubricated screw compressor category and recorded growth this year. Rather than exiting the low-cost segment, the company is leveraging its technical expertise to deliver ELGi-standard quality at competitive pricing.
In addition to new product development, ELGi is consolidating its manufacturing operations to improve efficiency. “Bringing everything under one roof will streamline logistics, reduce duplication, and enhance collaboration,” Varadaraj noted. The company is also open to expanding its manufacturing footprint overseas, with Europe and the U.S. emerging as potential locations based on market demand.
Despite geopolitical uncertainties, ELGi remains optimistic about its growth trajectory. Currently growing at nearly three times the rate of its competitors, the company aims to accelerate further. “To meet our long-term targets, we should be growing at five times the competition,” said Varadaraj.
Meanwhile, ELGi has relocated its corporate office to Bengaluru. Currently operating from a temporary location, it will move to its own office building in March.