How ELGi Plans to Scale Globally
WATCH: https://bit.ly/ELGi-INTEC26
Coimbatore-based air compressor manufacturer Elgi Equipments is aiming to accelerate global growth through technology-led innovation, digital transformation, and a major manufacturing consolidation project, according to Managing Director Dr. Jairam Varadaraj.
Speaking to mojo4industry at INTEC 2026, Dr. Varadaraj said the company is focused on helping customers reduce lifecycle costs through energy-efficient and sustainable compressor technologies while strengthening its position in international markets.
According to him, energy consumption remains the largest contributor to the lifecycle cost of compressors, accounting for a significant share of operating expenses. As a result, ELGi’s product development efforts are centred on improving efficiency and reducing environmental impact.
“The upfront cost of a compressor is only about 10–12% of the total lifecycle cost, while energy forms the largest component of operating costs. Our focus is on developing technologies that reduce energy consumption and lower overall ownership costs for customers,” he said.
The company is also working on solutions that reduce dependence on oil in compressor systems. One of the technologies showcased at INTEC 2026 was ELGi’s water-injected compressor, which eliminates oil while maintaining high energy efficiency.
Another highlight was the ELGi Demand=Match Technology, which can help customers reduce energy consumption by up to 17%. Dr. Varadaraj described it as a scientific innovation that delivers significant power savings without requiring expensive variable frequency drive systems.
Technology, Not Low-Cost Labour, Drives Competitiveness
Emphasising ELGi’s approach to manufacturing, Dr. Varadaraj said the company competes through technology rather than low-cost labour.
He cited the example of ELGi’s in-house motor manufacturing initiative, launched three years ago. Today, the company produces motors that are more cost-effective than comparable imports while offering higher efficiency and longer warranties.
“We want technology to be the source of competitiveness. The objective is not to depend on low-cost resources but to innovate through engineering and design,” he said.
₹600 Cr Investment to Consolidate Manufacturing
As part of its long-term growth strategy, ELGi has earmarked approximately ₹600 crore to consolidate manufacturing operations at its main campus near Coimbatore.
The company plans to gradually shift production activities from its city-based facilities to the larger integrated campus over the next four to five years. The move is expected to improve operational efficiency, logistics and productivity.
According to Dr. Varadaraj, the first phase of the project has already been completed, with further expansion planned in stages.
Journey from Outside the Top 100 to the Global Top Six
Reflecting on ELGi’s transformation over the past three decades, Dr. Varadaraj said the company’s growth was driven by investments in technology, quality systems and manufacturing excellence.
He stressed the importance of understanding not only how products are built but also the scientific principles behind their design. This focus on engineering science, coupled with world-class quality systems and selective backward integration, enabled ELGi to build a globally competitive business.
Today, ELGi ranks among the world’s top six air compressor manufacturers and has established a significant presence across Europe and the United States.
Strong Acceptance in Global Markets
Dr. Varadaraj said repeat orders from customers are the strongest indicator of ELGi’s acceptance in international markets.
While gaining recognition was a challenge when the company first entered Europe and North America more than a decade ago, he believes that phase has now been overcome.
“Our brand is recognised today. The challenge is no longer acceptance; it is increasing our participation in more opportunities across global markets,” he said.
Describing the company’s philosophy, he added, “We don’t just make in India. We make in India for the world.”
Focus Areas for the Next 5 Years
Looking ahead, ELGi plans to increase its annual growth rate from around 12% to 16–17%. The company is also focused on strengthening digital capabilities across the organisation, improving agility in responding to global disruptions, and investing in talent development.
Dr. Varadaraj noted that geopolitical events, supply chain disruptions and trade uncertainties are likely to remain recurring challenges for manufacturers worldwide, making organisational agility a critical capability.
Leveraging the Coimbatore Manufacturing Ecosystem
Commenting on Coimbatore’s role in ELGi’s growth, Dr. Varadaraj said success depends less on location and more on how effectively companies utilise available resources and opportunities.
He believes the region provides a strong industrial ecosystem and that businesses must focus on making the best use of the strengths already available to them.
As manufacturing industries increasingly prioritise energy efficiency, sustainability and productivity, ELGi’s investments in advanced compressor technologies, digital capabilities and manufacturing infrastructure are expected to play a key role in supporting its next phase of global expansion.
