Cool Change: Ajay Singhania

The prospect of selling air conditioners in India was always going to be a slam dunk idea by anyone’s measure. No one has known this better than EPACK Durable. Since its first foray in the industry assembling air conditioning units, it has never looked back.

At the end of the 1990s, LG and Samsung led the charge, employing local businesses to handle ancillary duties such as packaging.

One of those local packaging firms was EPACK Polymers, founded in Delhi in 1999 by brothers Ajay and Sanjay Singhania and the Bothra family. Then, after two years of manufacturing packaging for LG, an opportunity presented itself.

"We learned, in the course of discussion, that LG was looking for someone to assemble air conditioners for them," EPACK Durable Managing Director and CEO Ajay Singhania tells The CEO Magazine.

At the time, LG was one of the fastest growing conglomerates, highly ambitious and keen to penetrate Indian households. "They were growing very rapidly and looking at original equipment manufacturers to handle assembly at a regional level," Singhania says.

Although EPACK Polymers was a relative newcomer to manufacturing and one of the smaller suppliers in LG’s orbit, the company was shortlisted by the whitegoods giant as an assembler.

"It must have sounded absurd to LG management," Singhania says. "How can somebody doing packaging get into the manufacturing of air conditioners? But somehow we had luck on our side."

The change in direction prompted the creation of a new company, EPACK Durable, with the establishment of an air conditioning plant in Dehradun in 2003. The next 10 years were spent working exclusively with LG.

"We did air conditioners, microwave ovens, any product they wanted us to assemble," he says. "It gave us a great understanding of the appliance industry which, at that time in India, was still evolving."

In 2012, the company had built up enough confidence to branch out on its own. "It was a good time to look beyond LG and use what we’d gained," Singhania says. "We had to grow and create our own identity as an appliance manufacturer."

A Second Life

And so began the second life of EPACK Durable, one that began as so many do – on the outside looking in.

"The first product we made was just an outdoor AC unit, because at that point in time indoor units were largely imported by the prevalent brands, which were still looking at options to get outdoor units manufactured in India," Singhania recalls.

This meant the market was small enough for a fledgling company to make a splash. In the decade since, that market has ballooned from three million customers to close to nine million.

EPACK Durable, meanwhile, grew in tandem with the industry. "We gradually started adding newer products to our portfolio," he says.

"We realized that ACs are highly seasonal products. It’s good for the first six months of the calendar year, but the second half is always challenging, so we took on other appliances like induction cooktops, bottled water dispensers and mixer grinders."

This diversification helped EPACK Durable reach new clients. "Of the top 10 brands sold in the country, almost seven of them are our customers," Singhania says.

Even better, the company has been able to bring the lion’s share of its manufacturing in-house.

"The only major component we don’t manufacture is the compressor, which is about 30 percent of an air conditioner’s value," he adds.

"That’s how we can claim we’re the highest backward integrated AC manufacturer in India to date, and all done by way of organic growth. No acquisitions, nothing like that. All done in-house by us."

That house has grown beyond Dehradun. In 2022, EPACK Durable opened a second manufacturing plant in Bhiwadi in Rajasthan, while another opened in Sri City, near Chennai, in early 2024.

"Strategically these sites mean faster growth for our non-air conditioner segments," Singhania explains.

"Currently, a broad split of the company’s revenue is 85 percent from air conditioners, but going forward we’re structuring it in a way that the non-air conditioner segment is a growing category, and that’s in a market that’s expected to grow by 14 percent. We continue to grow with the market."

Smart Growth

EPACK Durable’s significant manufacturing facilities also gives the company an edge in terms of logistics.

"The industry depends quite a bit on raw material imports from Asian countries, but us being in the south, especially in the Chennai and Sri City areas, means we’re very close to the port, reducing port logistics costs," Singhania says. "That’s one benefit. The second is exportability."

While he admits the appliance industry is still on its way to being export ready, EPACK Durable is leading that charge.

"We’re taking small and sustainable steps not just for ourselves, but the industry and India as a whole, to become more competitive so we can cater to that export market."

Another point of difference among its peers is EPACK Durable’s ability to stay on top of technological advancements. "We invest heavily in technology and R&D, it’s all forward-looking," he says.

"AI and machine learning aren’t just jargon anymore. We already see it being applied to many day-to-day activities, and controlling appliances is one of those. To have a smart household, the appliances need to be smarter. We have a dedicated team of about 20 people working toward that."

Assisting EPACK Durable’s steady march into the future is its assortment of industry allies and partners. "We’re very selective," Singhania says. "I personally have a strong rapport with most of my key suppliers, and we won’t change suppliers just for the sake of price."

Many of EPACK Durable’s suppliers, including Bombay Coated and Special Steels and Shenzhen Megmeet Electrical, have been by the manufacturer’s side for many years. "Most have been with us for 10–15 years, and they’ve grown with us."

Any strategic supplier relationship worth its salt is only fruitful when it’s win–win, he adds.

"During the pandemic, the entire industry stopped. There were a lot of supply chain disruptions, and even larger companies were defaulting on payments."

EPACK Durable’s suppliers, on the other hand, stood by the business during even the toughest times.

"We kept on interacting with them. We assured them we would stand with them and equally they stood with us," he says.

"Once we associate with someone, it’s like a marriage for life. We help them grow and they provide us with quality, cost and delivery on time."

‘Make in India’

With EPACK Durable on a high growth trajectory, Singhania and his team seem poised to deliver great value not only to its customers, but suppliers and stakeholders as well.

"We’re looking at inclusive growth," he reveals. "We don’t want to leave anybody behind. We have targets we’ve committed to and we’ll definitely achieve those."

EPACK Durable raised its first round of private equity in 2021 – US$20 million – and the same again in 2022. "That helped us to scale up our capacities, and as an IPO, we’ll do so again to fund the next level of our expansion."

The need for appliances, and particularly the appliances of tomorrow, isn’t going away and neither is EPACK Durable and its innovative team.

"We’ve seen the ‘Make in India’ program take hold at a great rate over the past few years, so we need to be very fast in rolling out new products to catch the customer’s wallet before someone else does," Singhania reflects.

"We already know our customers, so for us it’s a matter of growing with them."