GAINING MARKET

SHARE IN PANIPAT

Mani HP Gas Service

29th September 2022
HPCL’s Historically Low Penetration in Non-Domestic Market in Panipat
PANIPAT MARKET (MT) - April '22 to REASONS FOR LOW PENETRATION
August '22
Majority
HPCL customers • IOCL & BPCL distributors offering very low rates
2% are because of volume on offer
industries
with high • Passing on ~9.50 to 10 Rs / kg discount to customer
consumpt on FOB basis
BPCL ion
IOCL
46%
52%
• IOCL bottling plant is located at a distance of 18 Km
from Panipat
• HPCL Bahadurgarh bottling plant is located at a
IOCL distance of 111 Km from Panipat
Proximity • Transportation cost of IOCL distributors is INR 0.20
PANIPAT April '22 to Monthly Volume to
bottling / kg
(VOLUME MT) August '22 (MT)
Plant • Transportation cost of HPCL distributors is INR 2.10
HPCL 79.5 (2%) 15.9
/ kg
BPCL 2021.5 (46%) 404.3
• IOCL distributors are passing on the benefit to
IOCL 2328.4 (52%) 465.7 customer
Total 4429.4 885.9
 Pricing Advantage to IOCL – Detailed Calculation
HPCL Costing Calculation for Distributor IOCL Costing Calculation for Distributor

Distance from bottling plant: 111 Km Distance from bottling plant: 18 Km

Transportation Cost per Kg: Rs. 2.10 Transportation Cost per Kg: Rs. 0.30

Spetember 2022 Rs/Kg Spetember 2022 Rs/Kg

ExMI Rate 75.93 ExMI Rate 75.93

Discount for 8500 no. Discount for 8500 no.
10.30 10.30
(19 Kg) (19 Kg)
Net Rate 65.63 Net Rate 65.63

Transportation cost 2.10 Transportation cost 0.20

Total Cost at Panipat 65.83
Total Cost at Panipat 67.73

We are atleast 2
Rs expensive as
compared to IOCL
 Plan to Gain Market Share from 2% to 27%
Current Customer Base

CUSTOMER NAME 425 47.5 19 19 Equivalent MT Rate Competition

BSBR Knit Fab 0 640 0 1600 30 66.00 Current Supply & Pipeline -
Wools India Knit Fab 0 320 0 800 15 66.15 Monthly
Garvit Green Industries 0 320 0 800 15 66.75
Gaba Homtex 0 240 0 600 11 66.75
EXISTING
BSBR Overseas 0 240 0 600 11 66.00 Indane
96 MT
Mahadev Processor 0 100 0 250 5 66.75
Mars Steel Fab 0 80 0 200 4 66.25 HPCL
POTENTIAL
Retail 0 0 200 200 4 70.00 243 MT
TOTAL 5050 96

PIPELINE
Customer Pipeline TOTAL 147 MT
VOLUME
886 MT
CUSTOMER NAME 425 47.5 19 19 Equivalent MT Pricing Expectation Competition

Arek industries 120 0 0 2684 51

Jai Jyoti Texo Fab 0 720 0 1800 34

65.50-66
Gold Spin India 75 0 0 1678 32 Indane

Cloudy India 0 640 0 1600 30

TOTAL 7762 147

 Key Asks from HPCL Management
As per September 2022 rates,

1. Requesting customer specific discount for 250 MT per month at Rs 11 / kg

2. Requesting for reimbursement of transportation expense at Rs 2.10 / kg

3. Issuance of time EMR loads for conversion of new customers, we can pick from any
nearby plant
4. Security amount deduction for 425 Kg is Nil for IOCL, however, it is approx. Rs 0.30 / Kg
for HPCL, thus making us uncompetitive in the market.

Such that landed FOB cost at Panipat is ~Rs 65 / kg and we can compete aggressively in the
market to gain market share and sustain it in future.
The rates to be aligned as per prevailing discount in that month.