comparision of HPCL, BPCL & IOCL

Apr 8, 2023 Indian Institute of Planning and managemnet 1

INDUSTRIAL RESEARCH

AARTI PUROHIT ARUN KOSHIYA JAISHANKAR PATEL

PRIYANKA BISWAS PUSHPA PATEL RESHMA D’SOUZA

VARUN MAURYA


Major Players in Petroleum Sector

BPCL

HPCL

IOCL

RIL

ESSAR

Shell


Market Share of Major Players

50.00%

25.50%

23.00%

1.50%

Market share

IOCLHPCLBPCLOthers


Market Share in Pipeline

47% 7%

16%30%

I OCL ONGC HPCL BPCL


Statistics of Total no. of Petroleum retail outlets for different OMC’s in India:

Company name March-2007 December-2007 March-2008

PSU’s

IOC 16,540 16,540 17,460

BPCL 7,609 8,089 8100

HPCL 7,909 8,060 8080

Total 32,058 32,689 33,640

Private Player

RIL 898 1800 1800

Essar 1,149 1250 1250

Shell 32 32 37

Others 2,079 3035 3042

Total 34,137 35,724 36682

Sources: Indian Oil and Gas and CRISIL Research




HPCL

BPCL

PrimaryCompa

nies

IOCL

Secondary

Company


HPCL

Hindustan Petroleum Corporation Ltd (HPCL) was incorporated as Standard Vacuum Refining Company of India Ltd in 1952, and later became the ESSO Standard Refining Company of India Ltd in 1962.

HPCL was formed with the merger of ESSO and Lube India Undertaking in 1974.

Caltex Oil Refining India Ltd and Kosan Gas Company were merged with the company in 1976 and 1979, respectively.

HPCL, a Navratna, is involved in refining and marketing petroleum products.


BPCL

It is the 3rd largest oil company in India owned by the Government of India.

Revenue (2005): $17.613 billion Employees: 12400 In 1976, the Burmah Shell Group of

Companies was taken over by the Government of India to form Bharat Refineries Limited.

In 1977, it was renamed Bharat Petroleum Corporation Limited.

It was the first refinery to process newly found indigenous crude (Bombay High), in the country.


Number of Refineries

Madras BhatindaMumbai

Mumbai


Demand Forecasting

•They track last five years sales figure and find out the growth rate

•They also track growth rate of automobile sales.

•Petroleum ministry gives total production plan.

•Same happens in BPCL.


After sale service

•For industrial products they take feedback of huge customer and carefully look about the need.

•For retail products there is no after sales services, all the services are available on petroleum pump.

•Facility for truck drivers to take bath, have food and cold drinking water.

•Drivers can sleep and relax on pump.

•No standard feedback mechanism, feedback is taken only from large customers.•Special petro-card for logistics companies is provided.•Logistics companies get 2 month credit period.


SCM – In/outbound logistics

•Inbound as well as outbound logistics are outsourced.

•Industrial customers have an option of using their vehicles or company’s vehicle.

•No company owned vehicle.

•Inbound logistics is outsourced.

•Outbound logistics is 50% outsourced and 50% company owned.

•Any customer don’t have any option to use their vehicle.


Marketing mix ( 4 P’s)

Product : Each and every petroleum products are available

Price : Petroleum ministry decides price of each and every product for each and every PSU.

Place : Services are available all over India and in selected countries, if not then use the resources of IOCL.

Promotion : Recently started aggressive advertisement by taking Sania Mirza as a brand ambassador.

Product : Each and every petroleum products are available

Price : Petroleum ministry decides price of each and every product for each and every PSU.

Place : Available only in selected states of India.

Promotion : Recently started branding of speed,.


International Marketing Research

•No research in international market.

•They only supply products to some countries like Japan, srilanka, etc.

•Not available in international market, not even planning to go.


Competition trends

Every year management of every PSU’s gather with petroleum ministry and talk about future plans and budget allocation.

Every year management of every PSU’s gather with petroleum ministry and talk about future plans and budget allocation.


Appointment of dealer.

•They 1st decide the place and then give advertisement.

•Interview is taken of applicants.

•If any person is willing to open a retail outlet in his locality then he can apply in HPCL.

•Same process is followed by BPCL.

•Only company decides where to open retail outlet.



BACKGROUND

Indian Oil Corporation Ltd. is currently India's largest company by sales with a turnover of Rs. 285,337 crore and profit of Rs. 2,950 crore for fiscal 2008-09.

A wholly owned subsidiary company, Indian Oil Technologies Ltd. is the 19th largest petroleum company in the world

Indian Oil's world-class R&D Centre has developed over 2,100 formulations of SERVO brand lubricants and greases for virtually all conceivable applications meeting stringent international standards and bearing the stamp of approval of all major original equipment manufacturers.

Indian Oil is also strengthening its existing overseas marketing ventures and simultaneously scouting new opportunities for marketing and export of petroleum products to new energy markets in Asia and Africa.


OVERVIEW

India’s largest oil company. Operates in India, certain Asian and African

countries. Owns nearly 93,00km of pipeline. Operates a network of 18,278 petrol and diesel

station. More than 32,000 marketing touch points, along

with its marketing subsidiary, IBP Co. Ltd.



Major divisions


IOCL Refineries:

Refineries Located at Installed Capacities (MMTPA)

Digboi Assam 0.65

Guwahati Assam 1.00

Barauni Assam 6.00

Koyali Gujarat 13.70

Haldia West Bengal 6.00

Mathura Uttar Pradesh 8.00

Panipat Near Delhi 12.00

Bongaigaon Assam 2.95

Chennai Tamilnadu 9.50

Paradip upcoming Orissa 15.00


Pipeline Transportation:

Operates a network of 10000 km long crude oil and petroleum product pipelines with a capacity of 62 MMTPA.

Commissioning of new projects worth about Rs. 2,300 crore including LPG and R-LNG pipelines will reach the capacity to 75 MMTPA with a network of over 10,000 km.

During the year 2008-09 Indian Oil’s crude oil pipelines Registered the 38.46 million metric tons.

All operating pipeline units have been accredited with ISO 9000 and ISO 14001 certificates.


Marketing:

One of the largest petroleum marketing and distribution networks in Asia, with over 32,000 marketing touch points.

The countrywide marketing operations are coordinated by 16 State Offices and over 100 decentralized administrative offices.

The wide network of services offered by Indian Oil, Marketing Division, which includes; commercial/reticulated LPG; total fuel management/ consumer pumps; Indian Oil Aviation Service; LPG Business (non-fuel alliances); loyalty programs; retail business (non-fuel alliances) and SERVO technical services.


Research & Development:

The R&D Centre continues to provide significant support to the Indian Oil Group refineries in product quality improvement, evaluation of catalysts and additives, health assessment of catalysts, material failure analysis, troubleshooting and in improving overall efficiency of operations.

India Oil's R&D Centre established that Biodiesel produced from Jatropha seeds were at par with that produced from vegetable oils.

Indian Oil has, till date, invested close to Rs. 1,000 crore in setting up world-class facilities at its R&D Centre

It plans to invest about Rs. 500 crore during the period 2007-12 to maintain its leadership in downstream R&D activities in the hydrocarbon sector.


IOC Brands:


4 P’s of IOCL


Products

Petrol Diesel LPG Auto LPG Aviation turbine fuel Lubricants Naphtha Bitumen Paraffin Kerosene


PRICE:

Price for all the products of all company is decided by petroleum ministry.

Very less difference in price of all PSU’s


PLACE:

Located all over India. Maximum number of refineries. Only company having retail outlet

outside India ( srilanka)


PROMOTION:

Subhiksha: Two ZOOP noodles packet free on

purchase of Rs. 250/- Dominos: Rs. 50/- off on each midsize dominos

pizza. PVR cinema: Rs 10/- off on eatables purchased

in PVR cinema. Rajdhani Thali: 10% off on each Rajdhani Thali. Yoko Sizzlers: 10% off in Yoko Sizzlers AC

Restaurants.


SWOT Analysis


Strengths:

High foreign exchange debt. Largest retail network all over India. Highest market share Expertise in Oil & Gas Industry Foreign subsidiaries and joint ventures In-House training centers


Weakness:

Stringent corporate policies Lack of marketing efforts Promotion policy Tender process


Opportunity:

Exploration and Production


Threats:

Entry of Big Private players


PEST Analysis


Political – Legal Environment

Entire oil industry is been governed by OIL Ministry and OIDB a Govt body

This two Institutes are responsible for all the decision related to the price, quality specification etc.

Beside this the international politics also affect this international commodity “Oil” a lot and also its companies

Any company operated in India had to work according to the norms and on the prices specified earlier by Govt bodies

Apr 8, 2023 41

Economic environment:

The gradual reduction of tariff protection has ensured that prices of most goods in countries like India are closer to global levels or even much lower.

The lower prices are much more extensive in the services sector, which accounted for 52.4% of the Indian economy in 2004- 05.

The use of GDP based on purchasing power parity in the calculation of oil intensity is also validated by the fact that the figures on oil consumption are measured in terms of volumes of input (million tons of oil equivalent-mote) while the GDP estimated on the market exchange rate gives only the value of output and not the actual volumes.

It is only the GDP estimated on a purchasing power parity basis which gives some indicator so the volume of output which should form the basis of cross country comparisons of output and estimation of oil intensity therein.

However, though the oil intensity in India is comparatively much lower than in most other developed and developing countries the negative impact of high oil prices on the economy is accentuated by the distorted pattern of oil consumption in India.

Indian Institute of Planning and managemnet


Social Cultural Environment:

Social cultural variation in the Indian context is very important for any company to work in it.

The India is basically can be divided into four major regions on the basis of language, demography and also the income states. These are the south, north, east and west.

The IOCL as a company also operates differently in different regions and also use different languages to attract people towards them.

This is also, a reason for which the companies have three refineries in the south region out of eleven in total. And that also because of the merger with MRPL a local regional company


Technological Environment

Indian Oil has, till date, invested close to Rs. 1,000 crore in setting up world-class facilities at its R&D Centre and it plans to invest about Rs. 500 crore during the period 2007-12 to maintain its leadership in downstream R&D activities in the hydrocarbon sector.

This the reason , that’s why IOCL have the India's first experimental H-CNG (Hydrogen-Compressed Natural Gas) dispensing unit at the R&D Centre campus at Faridabad and has been in the forefront of technology development for Bio-diesel production from various edible and non-edible oils and its application in vehicles.

Pioneering studies by India Oil’s R&D Centre established that Bio-diesel produced from Jatropha seeds were at par with that produced from vegetable oils.


Customer survey


Which petrol pump do you visit?

26%

38%

34%

2%

Preference

HPCLBPCLIOCLOTHERS


Why you prefer your selected pump?

38%

10%

42%

Preference

AvailabilityBrandgoodserviceloyalty programfriendsadvertisementothers


Score the company on following attributes (10 being highest)

00.5

11.5

22.5

33.5

4 3.54

3.2

4

33.5

3.2

3.93.5

3.2 3

4

HPCLIOCLBPCL

Apr 8, 2023 48

Do you use branded fuel?

20%

80%

USE

YESNO

Indian Institute of Planning and managemnet

If yes then go to question No. - 8


Reason for not using branded fuel?

80%

2%

18%

.

expensivedon’t support vehicleother


If branded fuel will be sold at normal rate will buy it?

84%

4% 12%

.

yesnonot sure


Which branded fuel do you use?

10%10%

20%

40%

20%

.

Xtra MileXtra premiumPowerTurbojetSpeed 93speed 95others


Since how long are you using branded fuel?

20%

30%

40%

10%

.

0 - 3mnt3 - 6 mnt6 - 1 yrmore than 1 year


What influenced you to go for branded fuel?

10%5%

5%

80%

Influenced

AdvertisementBrandFriendPersonal experienceothers


Has branded fuel Benefitted our vehicle?

40%

10%

50%

Benifited

YesNoNot sure


Are you satisfied with Branded fuel?

50%

10%

40%

Satisfied

YesNoNot Really


Recomendation

HPCL should come up with some loyalty or petro cards.

Because people don’t purchase fuel just because of good brand.

BPCL should come up with some extra services only for small customers.

BPCL should develop a good distribution network.


Thank you

Documents

comparision of HPCL, BPCL & IOCL