Dr Jairam Varadaraj: Our solution is superior in both capital cost and reliability

With close to 64 years of experience in manufacturing air compressors, ELGi is a global leader in providing sustainable compressed air solutions. ELGi designs and manufactures an extensive range of innovative and technologically advanced compressed air solutions for a variety of industry applications. To mark another milestone, Elgi has introduced a pioneering compressed air stabilisation technology. Designed to revolutionise the way compressors operate in plants with dynamic air demand, the Stabilisor system aims to address the longstanding challenges of unstable compressor performance, inefficiency, and excessive wear caused by frequent load/unload cycles. Dr Jairam Varadaraj, Managing Director, ELGi, shares insights on the products significance along with the company’s future plans.

When is the commercial production of ELGi Stabilisor scheduled to begin, and how long did the research and development process take?

We are ready to introduce the system. We will roll out this technology globally over six to seven months, progressing gradually to train our sales and service engineers worldwide to present it effectively to customers. Manufacturing and the supply chain are fully prepared. 

R&D took one and a half years for proof of concept and testing, backed by seven to nine years of experiments and failures.

What is the unique selling point of this Stabilisor, and how does it stand out from competitors?

I can’t speak for the competitors on how they think, but I can tell you how we do. You need to determine whether they think differently. Let me give you an example of an unstated want in simple terms and how we discovered it.

Take the well-known example of shampoo in a sachet. Earlier, shampoo was sold only in bottles by big FMCG brands, costing Rs 200-300. People at the bottom of the pyramid aspired to use shampoo but couldn’t afford a full bottle. A shampoo manufacturer  in Chennai innovated by introducing shampoo in a Rs 1 sachet. This made shampoo accessible to a larger audience and turned out to be more profitable than selling Rs 200 bottles.

Now, what was the discovery. The customer believed they could never afford shampoo. But within that belief lay an opportunity for innovation. Similarly, in our case, customers accepted that they had to pay 3 per cent more for an inverter drive or suffer inefficiency and instability. We saw an opportunity in this—could we achieve stability and efficiency without the high cost of an inverter? Once we defined this goal, we started looking for solutions that met these seemingly disconnected requirements.

Are my competitors thinking this way? I don’t know. They focus on efficiency through electronics and software, which is fine. But this is fundamental science, not just electronics or software. Are they approaching it at the level of science? Maybe, but there’s no clear evidence yet, so I can’t say for sure.

To what extent have you successfully convinced customers about this technology?

The jury is out, and now we wait. We approached two customers. The first refused, saying they already have an IoT device providing real-time data and didn’t want to share it with us, fearing higher charges. However, he allowed us four days to test our solution. Now, he’s refusing to return the machine—that’s how powerful our demonstration was.

Customers understand energy efficiency, and compressed air is highly inefficient. Any efficiency story resonates quickly. The real challenge is overcoming the bias toward foreign technology. We’ve introduced a world-first innovation from India, but convincing customers takes effort. That’s why we install it on their machines for them to see the results firsthand. The best part? If our machine doesn’t work, their system continues running as usual—unlike a VFD, which, if it fails, shuts the machine down.

Do you provide data-backed technical support for lifecycle cost analysis benefits on this Stabilisor?

We haven’t tested this technology in portable, engine-driven applications yet; our main focus is industrial use. However, we plan to expand it to portable applications. The savings are significant—not just in energy costs but also in oil life, condensation prevention, and filter longevity, as they remain under constant pressure. We’re documenting these benefits while primarily driving energy efficiency. The product, its components, and technology comply with global standards, including Europe’s Lot 31 for variable operating cycles, where we match 70 per cent efficiency.

Is ELGi the first company to introduce this technology in the industrial compressor segment? Do you plan to eventually replace the existing system with Stabilisor?

We are the first to develop this—it’s our patent. No other patent is even close. When we conducted a patent search after finalizing our idea, the only similar patent was our own previous one. We’ve worked on recovery and reuse before in a different context, and this is an extension of that. No one else has this.

As for the next steps, absolutely Stabilisor is our future. While we haven’t finalized our strategy, we have six stakeholders, including society and the environment. There’s internal debate on whether to offer this for free since the cost is low. However, anything given for free is often undervalued. The challenge is ensuring customers see its worth rather than dismissing it as just another free offering. We need to approach this carefully.

Regarding energy efficiency, the savings are significant. Compared to an inverter drive, which already exists, the key advantage is the lower upfront capital cost. Additionally, inverters fluctuate in speed, causing instability. Our system offers better stability and reliability—if an inverter fails, the compressor stops, but if the Stabilisor malfunctions, the compressor keeps running.

Will this technology completely replace VFDs, and what are the expected cost savings? Can it be retrofitted to compressors from any manufacturer, including competitors?

Regarding VFT, our solution is superior in both capital cost and reliability. If VFD fails, the machine stops, but with our system, that doesn’t happen. In retrofitting, we can implement the S2 valve, even on competitor machines, but a full Stabilisor system (S1 and S2) must come from our factory. Even with only S2, stabilisation is ensured, though energy savings will be lower.

Will this become a standard feature in ELGi compressors? How will this technology benefit the textile industry?

We want it to become a standard, right? Pricing is still being debated internally. The second point is that it is industry-agnostic. 

It’s like electricity—you enter a room, turn it on, leave, and turn it off. There’s constant fluctuation even when a building is fully occupied. The same applies to industries. 

In textiles, during piecing or doffing, demand fluctuates. In an auto corner, power fluctuates during changeovers. In the blow room, power usage changes as bales are moved. In weaving, there’s a pause between each weft insertion. 

This pattern exists across industries, making the system beneficial for all.

What are your capacity expansion plans for the next 3-5 years, and which countries or regions are your priority for selling this Stabilisor?

Our capacity strategy follows a long-term goal of reaching approximately $2 billion by 2035-36. We break this into three-year plans, ensuring clarity on targets and required capacity. Our policy is to build capacity one year in advance—so for 2025-26, we will develop capacity for 2026-27. 

For the Stabilisor, we will focus on five strategic regions: India, Australia, Europe, the USA, and Southeast Asia.

How would you describe the current state of the Indian textile machinery industry?

The spinning industry has been going through a rough patch, but things are starting to improve. Hopefully, the next couple of years will be much better.

Weaving hasn’t been hit as hard as spinning. With the challenges in Bangladesh and the impact of the China Plus One strategy, there’s a good chance the textile industry will see some positive momentum.

How would you assess the current state of the Indian construction equipment industry?

Construction equipment demand depends on infrastructure, which relies on government spending. More infrastructure development drives higher demand. However, this budget appears to have slowed infrastructure spending, so we’ll have to wait and see the impact.