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Future high resolution instrument planned by ISRO for space remote sensing will lead to higher data rates because of increase in resolution and dynamic range. Hence, image compression becomes mandatory. DPCM is one prediction based image compression technique (10:7) used in Resourcesat-2 mission. Based on received data from this mission, some artifacts are reported at high contrast targets as expected. Hence, an effort is made to analyze and improve the existing DPCM technique with minimum hardware modification by increasing the quantizer dynamic range and maintaining similar radiometric performance at low contrast locations. Newly developed technique provides RMSE of 16 counts compared to 41 counts with very high contrast image. Ringing artifacts are reduced to 7.6% compared to 38.2% with existing technique. Developed technique has low complexity and can be implemented in a low end FPGA without any external memory.