IndianOil is India's flagship national oil company with business interests straddling the entire hydrocarbon value chain. With over 34,000-strong workforce, IndianOil has been helping meet India's energy demands for over half a century.
IndianOil is India's flagship national oil company with business interests straddling the entire hydrocarbon value chain. With over 34,000-strong workforce, IndianOil has been helping meet India's energy demands for over half a century.
IndianOil is India's flagship national oil company with business interests straddling the entire hydrocarbon value chain. With over 34,000-strong workforce, IndianOil has been helping meet India's energy demands for over half a century.
IndianOil is India's flagship national oil company with business interests straddling the entire hydrocarbon value chain. With over 34,000-strong workforce, IndianOil has been helping meet India's energy demands for over half a century.
An
Assignment
ON
“Oil and Petroleum Industry Analysis”
IndianOil
A report submitted in partial fulfillment of the
Requirement of MBA program of
ICFAI Business School, Ahmedabad
Submitted to: SUBMITTED BY:
Prof. Swaroop Dutta Hardik Barot
Neha Desai
Foram Thakkar
Ayush SharmaPrashant Choksi
Indian Oil Company Limited-
SWOT and PESTEL analysis
Brief Profile of IOCL
IndianOil is India’s flagship national oil company with business interests straddling the entire
hydrocarbon value chain — from refining, pipeline transportation and marketing of petroleum
products to exploration & production of crude oil & gas, marketing of natural gas, and
petrochemicals. It is the leading Indian corporate in the Fortune 'Global 500’ listing, ranked at
the 125th.
With over 34,000-strong workforce, IndianOil has been helping to meet India’s energy demands
for over half a century. With a corporate vision to be the Energy of India, IndianOil closed the
year 2009-10 with a sales tumover of Rs. 271,074 crore and profits of Rs. 10,221 crore.
At IndianOil, the operations are strategically structured along business verticals - Refineries,
Pipelines, Marketing, R&D Centre and Business Development — E&P, Petrochemicals and
Natural Gas. To achieve the next level of growth, IndianOil is currently forging ahead on a well
laid-out road map through vertical integration— upstream into oil exploration & production
(E&P) and downstream into petrochemicals ~ and diversification into natural gas marketing and
alternative energy, besides globalisation of its downstream operations. Having set up subsidiaries
in Sri Lanka, Mauritius and the United Arab Emirates (UAE), IndianOil is simultaneously
scouting for new business opportunities in the energy markets of Asia and Africa,
With facilities at multiple locations and ever-expanding market opportunities, IndianOil is poised
to become an integrated energy company with steady forays into Oil Exploration & Production,
Petrochemicals and Renewable Energy.
Reach and Network
IndianOil and its subsidiaries account for over 48% petroleum products market share, 34%
national refining capacity and 71% downstream sector pipelines capacity in India
With a steady aim of maintaining its position as a market leader and providing best quality
products and services, IndianOil is currently investing Rs. 47,000 crore in a host of projects for
augmentation of refining and pipelines capacities, expansion of marketing infrastructure and
product quality upgradation.The IndianOil Group of companies owns and operates
10 of India's 20 refineries with a combined refining
capacity of 62.7 million metric tonnes per annum
(MMTPA, ie. 1.25 million barrels per day).
IndianOil’s cross-country network of crude oil and
product pipelines, spanning 10,899 km and the largest
in the country, meets the vital energy needs of the
consumers in an efficient, economical and
environment-friendly manner.
It has a portfolio of powerful and much-loved energy
brands that includes Indane LPGas, SERVO
lubricants, XtraPremium petrol, XtraMile diesel, etc.
Validating the trust of 56.8 million households, Indane
has eamed the coveted status of ‘Superbrand” in the
year 2009.
IndianOil has a keen customer focus and a formidable
network of customer touch-points dotting the
landscape across urban and rural India. It has 18,643
petrol and diesel stations, including 2,947 Kisan Seva
Kendras (KSKs) in the rural markets. With a
countrywide network of 35,600 sales points, backed
for supplies by 167 bulk storage terminals and depots,
98 aviation fuel stations and 88 LPGas bottling plants,
IndianOil services every nook and corner of the
country, Indane is present in almost 2764 markets
through a network of 5095 distributors. About 7,593
bulk consumer pumps are also in operation for the convenience of large consumers, ensuring,
products and inventory at their doorstep,
IndianOil’s ISO-9002 certified Aviation Service commands an enviable 63% market share in
aviation fuel business, successfully servicing the demands of domestic and international flag
carriers, private airlines and the Indian Defence Services. The Corporation also enjoys a 65%
share of the bulk consumer, industrial, agricultural and marine sectors.In Petrochemicals, IndianOil is investing Rs. 20,000
crore (US$ 4 billion) by the year 2011-12. It offers a
full slate of products including Linear Alkyl Benzene
(LAB), Purified Terephthallic Acid (PTA), and an
extensive range of polymers. IndianOil holds a
significant market share of LAB in India and exports
to 19 countries. A state-of-the-art 120,000 tonnes per
annum Styrene Butadiene Rubber (SBR) unit is
underway at Panipat. The SBR unit will further
strengthen IndianOil’s presence in the speciality
petrochemicals sector.
In Exploration & Production, IndianOil’s domestic |
portfolio includes ten oil & gas blocks and two Coal
Bed Methane blocks. The overseas portfolio includes
nine blocks spread across Libya, Iran, Gabon, Nigeria,
Timor-Leste and Yemen. Exploration activities are at
various stages of progress. In addition, as part of
consortium, IndianOil has been awarded Project -1 in
the Carabobo heavy oil region of Venezuela. To boost
E&P activities, IndianOil has incorporated Ind-OLL
Overseas Ltd. — a special purpose vehicle for
acquisition of overseas E&P assets — in consortium
with oil India Lid.
Natural Gas marketing is another thrust area for IndianOil with special focus on City Gas
Distribution (CGD) business. The Corporation has entered into franchise agreements with
several CGD players to market Compressed Natural Gas through its retail outlets. IndianOil’s
joint venture with GAIL India Ltd. - Green Gas Ltd. — has been authorised to take up city gas
distribution at Agra. A long term gas supply agreement has been signed with NTPC.
Venturing into alternative fuels
IndianOil has forayed into alternative energy options
such as wind, solar, bio-fuels and nuclear power. A 21
MW wind power project is operational in the Kutch
district of Gujarat and the cumulative power
generation from the 14 wind turbine generators has
crossed 6.6 crore units (KW/Hr) since commissioning
in January 2009. The solar power initiative is being
spearheaded on a pilot basis in Orissa, Kamataka and
the Northeast and an all-India phased roll out is
underway. Solar products such as solar lanterns and
torches are being sold through the Retail Outlets inrural and urban areas. With a view to investing in the nuclear energy sector in the country,
IndianOil has entered into an agreement with the Nuclear Power Corporation of India Ltd.
IndianOil has the largest captive plantation ~ over 1,000 hectares ~ for bio-fuel production in
India which is underway in Chattisgarh and Madhya Pradesh, generating rural employment of
over 1.4 lakh man-days. To straddle the complete bio-fuel value chain, IndianOil has formed a
joint venture with the Chhattisgarh Renewable Development Authority. IndianOil CREDA
Biofuels Ltd. has been formed to carry out farming, cultivating, manufacturing, production and
sale of biomass, bio-fuels and allied products and services in Chattisarh. In Uttar Pradesh,
IndianOil is establishing a model value chain for the production of bio-diesel. A MoU for
collaborating on commercial production of bio-diesel from algae has also been signed with PA
LLC.
As a leading public sector enterprise of India,
IndianOil has successfully combined its corporate
social responsibility agenda with its business offerings,
meeting the energy needs of millions of people
everyday across the length and breadth of the country,
traversing a diversity of cultures, difficult terrains and
harsh climatic conditions. The Corporation takes pride
in its continuous investments in innovative
technologies and solutions for sustainable energy flow
and economic growth and in developing techno-
economically viable and —_environment-friendly
products & services for the
Benefits to the customers.Business in which IOCL operates :
‘An energy self-sufficient India can alter the economic, political and manufacturing landscape of
the region. Its quest for energy will create new economic and strategic challenges, right from
mobilising capital to engaging in subtle diplomacy.
IndianOil’s own performance in the financial year 2006-07 was a case of ‘exceeding
expectations’ with both tumover and profits reaching new highs, product sales registering a
quantum jump, and the refineries as well as pipelines network enhancing their capacities beyond
60 MMTPA and registering record throughputs. New projects worth Rs, 10,000 crore were put
on stream during the year. Among new businesses, the petrochemicals and natural gas verticals
and participating interests in a clutch of oil & gas assets in India and abroad has ensured
expansion of the upstream portfolio.
IndianOil has ambitious investment plans of Rs. 43,250 crore in the next five years. By 2011-12,
the IndianOil Group, with 80 MMTPA refining capacity in its fold, would be playing a key role
in realising India’s bid to emerge as an export-oriented hub for finished products. The pipelines
network, which provides strategic logistics advantage to the marketing operations, is also set to
cross the 10,000 km mark in the next two years.
In marketing, IndianOil is set to leverage the combined strength of over 32,000 marketing touch
points, with focus on hitherto untapped rural markets, non-fuel revenues and pure retailing
business. IndianOil aspires to be Asia’s leading commercial R&D organisation in the
downstream hydrocarbon sector by building on its capabilities in developing innovative
technologies, products and processes, and nodal research in alternative fuels.
Beyond core businesses, IndianOil is working to emerge as a major player in the petrochemicals
business by the year 2011-12, with two petrochemical hubs shaping up at Panipat and Paradip. In
natural gas business, it is attempting quantum growth in LNG imports, infrastructure and
marketing, besides city gas distribution. In the high-risk business of oil exploration &
production, IndianOil’s consortium approach with established players is paying off well in terms
of exceptional Government support and successful forays in India and abroad, Its current
interests are focussed on oil equity and sourcing of natural gas, predominantly from African and
CIS countries, by leveraging its downstream capabilities to form joint venture partnerships with
reputed enterprises overseas.
With India’s energy needs projected to grow by 40% in the next five years, the future is indeed
full of promise for IndianOil; a future the 31,700 strong IndianOil team shall build as they fuel
the dreams of over a billion of their countrymen.Vision and Mission
VISION
Ethics
Satting high
standards for
ethics and values.
People
Leading with
passion
to-exce!
Customers
Fostering
relationships
fora itetime
IndianOil
The Energy of India
A Globally Admired Company
Innovation
Picngering the
spinit of creativity
‘and research
Technology
Hamessing
frontier
technology
Environment
Caring for the
environment and
community
VALUES
Care « Innovation « Passion « TrustMission
To achieve international standards of excellence in all aspects of energy and diversified
business with focus on customer delight through value of products and services, and cost
reduction.
To maximize creation of wealth, value and satisfaction for the stakeholders.
To attain leadership in developing, adopting and assimilating state-of-the-art
technology for competitive advantage
To provide technology and services through sustained Research and Development.
To foster a culture of participation and innovation for employee growth and
contribution.
To cultivate high standards of business ethies and Total Quality Management for a
strong corporate identity and brand equity.
To help enrich the quality of life of the community and preserve ecological balance
and heritage through a strong environment conscience.Products of IOCL :
IndianOil is not only the largest commercial enterprise in the country itis the flagship
corporate of the Indian Nation. Besides having a dominant market share, IndianOil is
widely recognized as India’s dominant energy brand and customers. perceive
IndianOil as a reliable symbol for high quality products and_ services.
Benchmarking Quality, Quantity and Service to world-class standards is a philosophy
that IndianOil adheres to so as to ensure that customers get a truly global experience
in India. Our continued emphasis is on providing fuel management solutions to
customers who can then benefit from our expertise in efficient sourcing and least cost
supplies keeping in mind their usage patterns and inventory management.
IndianOil is a heritage and iconic brand at one level and a contemporary, global
brand at another level. While quality, reliability and service remains the core benefits
to our customers, our stringent checks are built into operating systems, at every level
ensuring the trust of over a billion Indians over the last four decades.
Our Retail Brand template of XtraCare(Urban), Swagat(Highway) and Kisan Seva
Kendras(Rural) are widely recognized as pioneering brands in the petroleum retail
segment. IndianOil’s leadership extends to its energy brands - Indane LPG, SERVO
Lubricants, Autogas LPG, XtraPremium Branded Petrol, XtraMile Branded Diesel,
XtraPower Fleet Card, IndianOil Aviation and XtraRewards cash customer loyalty
programme.
Some of the Core products of IOCL are listed below.
¥ Indane Gas
Auto Gas
Natural Gas
PetroVGasoline
Diesel/Gas Oil
ATFidet Fuel
SERVO lubricants and greasess
Kerosene
Bulk/Industrial Fuel ~ Furnace Oil, Light Diesel Oil and LSHS
Petrochemicals- Lab HMW, Lab LMW, PTA and Polymers
SKK RRR SS
Special Products- Benzene, CBFS, Food Grade Hexane, Jute Batching Oil, Propylene¥ Crude Oil
SWOT Analysis for IOCL
External environment
Opportunity: -
‘The JOCL has much opportunity in the present market conditions, This is
because the petroleum products are become a need for everyone and still contains a lot of scope
for customization. The various opportunities are listed below.
Threat:
Since the company has the maximum number of out lets and also the maximum no. of
refineries in India, it can very easily go for extension at any point of time, and can
introduce any new produets, which will get support from its huge market network.
The company can make the buying process more easy for the customers, by implying
many more schemes in the range of XTRAPOWER AND XTRAREWARD.
The company can think over the issue to build its own pipelines, so that it will be a
independent player and it will also support its aviation fuel supply.
Company has a great scope in E&P. It already operates in this business but in a limited
scale.
Since the company is the market leader in the field , so have maximum threats
from the other players and many other issues. The lists of threats are given below.
The foreign players with more advanced technology are the biggest threat
for the company.
The crude oil supply is also a big issue in front of the company, because
the company cannot fix its price and so, some time had operate in loss
also. it is the biggest problem because the maximum part of their crude is
been imported,
In future the market will welcome more private players, which will eat up
its market share.
If the Govt, Policies allow the private players to set their own price, the the
private player can seriously harm the market share of IOCL