At Auto Expo Components Show 2018, we showed that Elofic is BS VI-ready
Elofic Industries manufactures filters for passenger cars, tractors and commercial vehicles. Joint MD KD Sahni spoke to Kiran Bajad on the response to the company's participation at the recent Components Show in New Delhi.
How was the response at Auto Expo 2018?
We have had high engagement and most of our customers and dealer distributors visited us. The response this year has been better than our expectations. We see Auto Expo as a platform to engage with the entire automotive ecosystem.
Can you elaborate on your current business plan?
There were some minor hiccups during the first quarter of this fiscal year due to GST implementation. There was an impact on the aftermarket business whereas the OEMs’ business largely consistent and growing over 25 percent YoY. We are extremely excited about the business prospects with OEMs. We cater to all the segments of the automotive industry including two-wheelers, passenger cars, tractors, medium and heavy commercial vehicles, industrial, small engines, generators, off-highway, petrol chemical, and air-conditioning.
What is the major focus area for Elofic Industries?
The focus is technologies — to become a leader, today one has to be focused on technologies, new product development and constantly stay ahead. At Components Show 2018, we displayed to all our customers that Elofic is BS VI-ready. We have a product that can meet the need of various OEMs; in fact, we are already working with several of them since inception stage as this takes time. Our team has constantly worked on BS VI technologies. We are also looking at global technological changes to equip ourselves to become future-ready.
What is Elofic’s product portfolio spread in terms of various industry segments?
With filters being an aftermarket product, overall 35 percent of our revenue are exports; of this 80 percent are OEMs. The domestic aftermarket business is 40 percent and 25 percent is OEMs. Filters are the key products for us, lubrication is our secondary product, but five months ago we have added air purifiers for domestic and office purposes.
To what do you attribute Elofic Industries’ success in the export market?
India looks quite attractive for global OEMs for sourcing products from a supplier. Over the years, Indian suppliers have set up most modern manufacturing facilities with capabilities to supply quality products on a consistent basis. Our quality is respected by our overseas customers. We have a warehouse in all the key overseas locations to store products and are able to supply just in time to our customers. Quality and reliable delivery are critical to gain customer confidence. The majority of our exports is to North America and Europe.
Elofic has been growing consistently both in domestic and overseas markets. Do you foresee any challenges in the near future?
We have to keep de-risking ourselves as OEMs have been dependent on suppliers in terms of sourcing critical products just-in-time. Therefore, as key suppliers, we have keep ourselves ready to address the need of the OEMs through some contingency plan if there is any production disruption. We are working on this area quite seriously to ensure that supplies to OEMs are consistently maintained.
How many plants does the company currently operate?
We have six manufacturing locations — four plants are in the NCR and one each in Himachal Pradesh and Hosur. We are among few companies which are self-reliant in terms of child parts. We manufacture all the components required for filters in-house. We have our own press-shop, injection moulding, oil blending and grease making for lubricants.
We believe in having all the manufacturing control in our hand. This helps us in pricing, cost, quality, and reliability in terms of delivering products to our customers. Every year we invest more than Rs 25-30 crore in plant capacity, upgradation and investment in technologies; this is a process which will continue.
What are your growth expectations for 2020?
We are a 66-year-old company and in all these years Elofic has never seen a decline in growth. We will certainly continue this trend going forward. Depending upon the market conditions, the growth may slower or higher but every year we have been growing.