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Submitted to College of Management & Economic Studies for the partial fulfilment of the degree of
Submitted by: ANJALI NAUTIYAL Enrolment No: R170209016 SAP ID: 500008222
College of Management and Economic Studies University of Petroleum and Energy Studies Dehradun, Uttarakhand, India
NOVEMBER, 2011
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CERTIFICATE
This is to certify that Anjali Nautiyal has developed and implemented the dissertation work entitled Marketing Strategy Of IOCL In India under my guidance at University Of Petroleum & Energy Studies from November11 to april12 for partial completion of BBA Oil & Gas from University Of Petroleum & Energy Studies, Dehradun. The project has been completed successfully to our satisfaction and their conduct during the tenure of the dissertation was good.
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S.NO
CHAPTER
PAGE NO.
Introduction
II
Literature Review
III
Objectives
IV
Research Methodology
Problem Of Statement
VI
Conclusion
VII
Limitation
Reference
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ACKNOWLEDGEMENT
Dissertation is an integral part of any management program. I feel myself lucky that I got the opportunity to make my dissertation in one of the largest and most popular oil sector university, University of Petroleum and Energy Studies. I take the opportunity to express our gratitude to all of them, who helped us to accomplish this challenging report in UPES . I wish to express our deepest sense of gratitude towards our respected mentor, Mr.A.Lakshaman Rao. I have received enormous inputs and inspiration in various stages of our project from them.
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CHAPTER -1
INTRODUCTION
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INTRODUCTION
Indian Oil Corporation Limited, or Indian Oil is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India. The company is the world's 98th largest public corporation, according to the Fortune Global 500 list, and the largest public corporation in India when ranked by revenue. Indian Oil and its subsidiaries account for a 47% share in the petroleum products market, 34% share in refining capacity and 67% downstream sector pipelines capacity in India .The Indian Oil Group of Companies owns and operates 10 of India's 21 refineries with a combined refining capacity of 65.7 million metric tons per year. It is one of the five Maharatna status companies of India, apart from Coal India Limited, NTPC Limited, Oil and Natural Gas Corporation and Steel Authority of India Limited. Indian Oil operates the largest and the widest network of fuel stations in the country, numbering about 19,463 (15,946 regular ROs & 3,517 Kissan Sewa Kendra). It has also started Auto LPG Dispensing Stations (ALDS). It supplies Indane cooking gas to over 62.4 million households through a network of 5,456 Indian distributors. In addition, Indian Oil's Research and Development Center (R&D) at Faridabad supports, develops and provides the necessary technology solutions to the operating divisions of the corporation and its customers within the country and abroad.
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HISTORY
Indian Oil began operation in 1959 as Indian Oil Company Ltd. The Indian Oil Corporation was formed in 1964, with the merger of Indian Refineries Ltd.
PRODUCTS
Indian Oil's product range covers petrol, diesel, LPG, auto LPG, aviation turbine fuel, lubricants, naphtha, bitumen, paraffin, kerosene etc. Xtra Premium petrol, Xtra Mile diesel, Servo lubricants, Indane LPG cooking gas, Autogas LPG, IndianOil Aviation are some of its prominet brands. Recently Indian Oil has also introduced a new business line of supplying LNG (liquefied natural gas) by cryogenic transportation. This is called "LNG at Doorstep".
REFINERIES IN ASSAM
Digboi Refinery, in Upper Assam, is India's oldest refinery and was commissioned in 1901. Originally a part of Assam Oil Company, it became part of IndianOil in 1981. Its original refining capacity had been 0.5 MMTPA since 1901. Modernisation project of this refinery was completed by 1996 and the refinery now has an enhanced capacity of 0.65 MMTPA.
Guwahati Refinery, the first public sector refinery of the country, was built with Romanian collaboration and was inaugurated by Late Pt. Jawaharlal Nehru, the first Prime Minister of India, on 1 January 1962. Its capacity is 1 MMTPA.
Bongaigaon Refinery became the eighth refinery of IndianOil after merger of Bongaigaon Refinery & Petrochemicals Limited w.e.f. 25 March 2009. It is located at Dhaligaon in Chirang district of Assam, 200 km west of Guwahati.
IN BIHAR
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Barauni Refinery, in Bihar, was built in collaboration with Russia and Romania. It was commissioned in 1964 with a capacity of 1 MMTPA. Its capacity today is 6 MMTPA.
IN GUJARAT
Gujarat Refinery, at Koyali (near Vadodara) in Gujarat in Western India, is Indian Oils second largest refinery. The refinery was commissioned in 1965. It also houses the first hydrocracking unit of the country. Its present capacity is 13.70 MMTPA.
IN WEST BENGAL
Haldia Refinery is the only coastal refinery of the Corporation, situated 136 km downstream of Kolkata in the Purba Medinipur (East Midnapore) district. It was commissioned in 1975 with a capacity of 2.5 MMTPA, which has since been increased to 7.5 MMTPA.
IN UTTAR PRADESH
Mathura Refinery was commissioned in 1982 as the sixth refinery in the fold of IndianOil and with an original capacity of 6.0 MMTPA. Located strategically between the historic cities of Delhi and Agra, the capacity of Mathura refinery was increased to 8.8 MMTPA.
IN HARYANA
Panipat Refinery is the seventh and largest refinery of IndianOil. The original refinery with 6 MMTPA capacity was built and commissioned in 1998. Panipat Refinery has since expanded its refining capacity to 15 MMTPA.
It is believed that the future IOCL refinery Will be Paradeep Refinery. It is expected to be handover at 2012. Subsidiary refineries Chennai Petroleum (10.5 MMTPA)
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IndianOil (Mauritius) Ltd. Lanka IOC PLC Group company for retail and storage operations in Sri Lanka. It is listed in the Colombo Stock Exchange. It was locked into a bitter subsidy payment dispute with Sri Lanka's Government which has since been resolved.
IOC Middle East FZE Chennai Petroleum Corporation Limited Green Gas Ltd. a joint venture with Gas Authority of India Ltd. for city-wide gas distribution networks. Indo Cat Pvt. Ltd., with Intercat, USA, for manufacturing 15,000 tonnes per annum of FCC (fluidised catalytic cracking) catalysts & additives in India. Indian Oil CREDA Bio-fuels Ltd., a joint venture with Chattisgarh government for production and marketing of Bio-fuels. Numerous exploration and production ventures with Oil India Ltd., Oil and Natural Gas Corporation.
INTERNATIONAL RANKINGS
Indian Oil is the highest ranked Indian company in the Fortune 'Global 500' listing, 98th position in 2011. It is also the 18th largest petroleum company in the world and the No. 1 petroleum trading company among the National Oil Companies in the Asia-Pacific region. IOCL was featured on the 2011 Forbes Global 2000 at position 243. It is fifth most valued brand in India according to an annual survey conducted by Brand Finance and The Economic Times in 2010.
LOYALTY PROGRAMS
XTRAPOWER Fleet Card Program is aimed at Large Fleet Operators. Currently it has 1 million customer base. XTRAREWARDS is a recently launched loyalty program for retail customers where customers can earn reward points on their purchases.
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COMPETITORS
Indian Oil Corporation has two major domestic competitors, Bharat Petroleum and Hindustan Petroleum. Both are state-controlled, like Indian Oil Corporation. There are two private competitors, Reliance Industries and Essar Oil.
CONCERNS
The volatility in the crude market & subsidy burden on the IOCL has dented the company performance like other PSU oil companies. This is also reflected in its FORTUNE rating this year. Moreover, bureaucratic hurdles in projects are hurting company advancement. IOCL has one of the best technical manpower for execution of jobs.The newly announced 5 billion dollar contract with Iran raises severe implications on the UN and U.S. sanctions on nuclear proliferation.
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"Biomass pyrolysis is an attractive option for India as solid waste biomass can be easily converted into liquid products through decentralised units to avoid costlytransportation."
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some sort of agreement and understanding among bidders to manipulate the process of bidding, the Commission noted. It noted that of the 63 bidders, who participated in the tendering process, 50 bidders were qualified for opening price bids, 12 bidders were qualified as new vendors and one bidder was disqualified. Indian Oil, a leading player in the LPG business with 48.2 per cent market share, is a major procurer of the 14.2 kg LPG cylinders. In addition to Indian Oil's tender, Hindustan Petroleum Corporation floated a tender for 36 lakh cylinders, and Bharat Petroleum Corporation floated tender for procurement of 40.33 lakh cylinders. While HPCL and BPCL adopted e-platform for tender invitation and finalisation, Indian Oil was procuring by way of inviting tenders.
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bottling has been called off." According to the official, IndianOil usually delivers gas cylinders within 25 days of an order being placed, but for some time that time gap might go up to 35 days. He assured that supply to all adjoining districts of Ernakulam would be normalised soon. The official said IndianOil, the largest public sector oil retailer, would have to work overtime to meet the demand expected to rise in the coming Easter and Vishu festival days. The official also said he had no information about LPG distributors in the state threatening to go on strike to demand increase in margin. Meanwhile, residents heaved a sigh of relief. "I was worried since I have just one Indane connection. I am happy the strike has been called off," Ms Sunitha, a resident of Chilavannoor, said.
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Dhamara and Gopalpur as probable locations for its proposed project involving an investment of INR 5000 crore.
EXPORT QUALITY
Vishnu Goel, president of the North India Shody Mill Association said that polar blankets are yet to enter the export market. At present, it would cater to the domestic market only. He said that the yarn industry can compensate this competition by enhancing its business in the export market where Indian yarn products are in high demand. He said that if the Inland Container Depots (ICD), Babarpur in Panipat - chapter of the Container Corporation of India (CCI) - which provides facility to export products made in Panipat but is unable to import products directly to Panipat. Because of this, Panipat businessmen are forced to import from CCI, New Delhi. Mr Goel said there is an urgent need to enhance facilities at ICD, because in coming days the petro hub at Panipat is going
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to add many more export-oriented industries in its fold like auto components, woven sacks and polyester. "At present, Panipat businessmen are importing around 300 containers from CCI, New Delhi, which is an added burden on the Panipat industry" said Sukhmal Jain, member of the Haryana Chamber of Commerce and Industries and vice president (VP) of the Panipat Exporters Association. "If this (import) facility is added to ICD, Panipat, it would help local businessmen in cutting cost and compete with not just polar but mink blankets (imported from China) as well," said Mr Jain. He concluded that it would also help polar blanket business to cater to the export market
REFINING
Born from the vision of achieving self-reliance in oil refining and marketing for the nation, IndianOil has gathered a luminous legacy of more than 100 years of accumulated experiences in all areas of petroleum refining by taking into its fold, the Digboi Refinery commissioned in 1901.At present, IndianOil controls 10 of Indias 20 refineries.The strength of IndianOil springs from its experience of operating the largest number of refineries in India and adapting to a variety of refining processes along the way. Having absorbed state-of-the-art technologies of leading process licensors like UOP, Chevron, IFP, Stone & Webster, Mobil, Haldor Topsoe, KTI/Technip, Linde, CD-Tech, Stork Comprimo, etc., IndianOil in an excellent position to offer O&M services for latest technologies such as distillate FCCUs, Resid FCCUs, hydrocrackers, reformers (both semi-regenerative and continuous catalytic regeneration types), lube processing units, catalytic de-waxing units, cokers, coke calciners, visbreakers, merox, hydro-treaters for kero and gasoil streams, etc. IndianOil refineries also have units for producing specialty products such as bitumen, LPG, MTBE, Butene-1, Propylene, Xylenes, Di-Methyl Terephthalate (DMT), polyester staple fibre (PSF) and other petrochemicals like Linear Alkyl Benzene, Paraxylene (PX), Purified Terepthalic Acid (PTA), etc. The Corporation has commissioned several grassroot refineries and modern process units. Procedures for commissioning and start-up of individual units and the refinery have been well laid-out and enshrined in various customised operating manuals, which are continually updated. IndianOil also offers the specialised services of its experts for commissioning/start-up assistance depending on the clients need. Its team is also well-equipped to prepare operation manuals with clear instructions for plant start-up, operation, shutdown, emergencyhandling,etc.
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On the environment front, all IndianOil refineries fully comply with the statutory requirements. Several Clean Development Mechanism projects have also been initiated. With its vast experience in successfully implementing SH&E policy and practices at various units, IndianOil offers its services in ensuring that the clients work environment is safe, healthy and clean.IndianOil also offers faculty assistance for tailor-made training programmes that suit the requirement of refinery or pipelines personnel or a selection of programmes from the clients training calendar.Innovative strategies and knowledge-sharing are the tools available for converting challenges into opportunities for sustained organisational growth. IndianOils Refineries team have a deep understanding of the complexities of all the process units of modern refineries and can offer comprehensive services of a highly professional nature on different facets given in details in this segment.With strategies and plans for several value-added projects in place, IndianOil refineries will continue to play a leading role in the downstream hydrocarbon sector for meeting the rising energy needs of our country.
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FINANCIAL OBJECTIVES
To ensure adequate return on the capital employed and maintain a reasonable annual dividend on equity capital. To ensure maximum economy in expenditure. To manage and operate all facilities in an efficient manner so as to generate adequate internal resources to meet revenue cost and requirements for project investment, without budgetary support.
To develop long-term corporate plans to provide for adequate growth of the Corporations business. To reduce the cost of production of petroleum products by means of systematic cost control measures and thereby sustain market leadership through cost competitiveness. To complete all planned projects within the scheduled time and approved cost.
OBLIGATIONS
Towards customers and dealers:- To provide prompt, courteous and efficient service and quality products at competitive prices.
Towards suppliers:- To ensure prompt dealings with integrity, impartiality and courtesy and help promote ancillary industries.
Towards employees:- To develop their capabilities and facilitate their advancement through appropriate training and career planning. To have fair dealings with recognised representatives of employees in pursuance of healthy industrial relations practices and sound personnel policies.
Towards community:- To develop techno-economically viable and environment-friendly products. To maintain the highest standards in respect of safety, environment protection and occupational health at all production units.
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Towards Defence Services:- To maintain adequate supplies to Defence and other paramilitary services during normal as well as emergency situations.
OBJECTIVE
1) To maximize the utilization of the existing facilities for improving efficiency and productivity. 2) To understand the marketing strategy of IOCL. 3) To develop long-term corporate strategy to provide for adequate growth of the Corporations business.
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Strict adherence to time line of the project, reduction in cost, and meeting high demand on safety, while maintaining excellent quality in execution, is the prime concern of all project companies. It amounts to quickly creating a large pool of qualified Project executives, exposing and imparting them to global skill and mind sets. This programme is focused mainly, on sharing the best practices and experiences in executing world-class projects, besides providing requisite inputs to the state of art method applied and knowledge available. The programme aims to provide a broad understanding of project management, its objectives, techniques and learn how lo adapt the project management techniques in a more complex environment by integrating plant staff support for revamp project implementation.
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SERVICE (MARKETING)
IndianOil provides a wide range of marketing services and consultancy in fuel handling, distribution, storage and fuel/lube technical services. With a formidable bank of technical and engineering talent, IndianOil is fully equipped to handle small to large-scale infrastructural projects in the petroleum downstream sector anywhere in the country. Our project teams have
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independently or jointly as a consortium, have set up depots, terminals, pipelines, aviation fuel stations, filling plants, LPG bottling plants, amongst others. IndianOil's fuel management system to bulk customers offer customized solutions that deliver least cost supplies keeping in mind usage patterns and inventory levels. A wide network of lubricant and fuel testing laboratories are available at major installations which is further backed by sector-wise expertise in the core sectors of power, steel, fertilizer, gas plants, textile mills, etc. Cutting edge systems and processes are designed around one simple belief-to provide valuable customers with an unbeatable edge in their business. IndianOil's supply and distribution network is strategically located across the country linked through a customized supply chain system backed by front offices located in conceivably every single town of consequence.The wide network of services offered by IndianOil, Marketing Division is illustrated in this section, which includes; commercial/reticulated LPG; total fuel management/ consumer pumps; IndianOil Aviation Service; LPG Business (non-fuel alliances); loyalty programs; retail business (non-fuel alliances) and SERVO technical services.
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operating parameters, evaluation of licensors' process technologies, development of novel processes and simulation models. Material failure analysis and remaining life assessment of refinery equipment and installations is a highly specialized service being provided by the R&D Centre to the refineries of IndianOil as well as other companies. With a vision of evolving into a leader as technology provider through excellence in management of knowledge, technology and innovation, IndianOil has launched IndianOil Technology Ltd. The new subsidiary markets the intellectual properties developed by IndianOil R&D Centre.
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The study majorly reached on SECONDARY DATA (also known as desk research) involves the summary, collation and/or synthesis of existing research Secondary research can come from either internal or external source. According to the secondary data we have make our report on Marketing Strategy of IOCL in India. Focussing on the fact and earlier reports as well as on the research and statement of the company. The marketing strategy which IOCL going to implement on its product is to launch the market as well as the facility which IOCL provide to its customer and member. IOCL not only focussed in the goal but also focussed in the customer satisfaction. And during the process of collecting information saw various report of IOCl growth and development in today world.
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Though the Indian customer had a choice of branded fuels, there were no clear favorites. Since it was a recent phenomenon in India, a company promoting branded fuels is faced with challenges on two fronts:
1) The customer needs to be educated to induce product trials. 2) To ensure that their market share of branded fuels is highest.
To make sure that the marketing strategy which is applied in market is correct.
3) Data in the report is not acqurate. 4) Data in the report is time consuming. 5) Data is collected from secondary source so it took lot of study. 6) During the study we came to know that company focussing not in one field.
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CHAPTER-6 CONCLUSION
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At a time when the petroleum industry is moving towards new horizons, exploring new technologies, collaborating and developing symbiotic relationships to ensure secure, environmentfriendly and affordable energy supplies, Indian Oil too is seeking quantum leaps in its core business, adding on new and emerging segments on the way. IndianOil owns and operates 6 of the refineries with a combined refining capacity of over 25 million tonnes per annum (5,00,000 bpd). Another 6 million tonnes per annum (1,20,000 bpd) refinery will be ready during fiscal 1997. Constant technology upgradation enables achievement of over 100% capacity utilisation. IndianOil has the largest network of over 5,300 km onshore crude oil and petroleum product pipelines in the country which operate at over 100% capacity and are equipped with latest technology. IndianOil sold 41.97 million tonnes of petroleum products during the year 1996-97. It markets 55% of the petroleum products consumption of India. In aviation fuels, its market participation is 69%. Its nationwide retail network of nearly 18,000 sales points (6,731 petrol stations, 3,413 kerosene dealers, 2,834 LPG distributors and 4,820 bulk consumer outlets) is backed for supplies by 178 bulk storage terminals and depots having a tankage of five million kilolitres. There are 92 aviation fuel stations besides 39 LPG bottling plants with a capacity of 1.5 million tonnes to cater to nearly 15 million customers in over 1,300 towns all over the country. IOCL is also having growth in research and development area. Providing more n more knowledge to the customer, dealers , retailers etc about there products. Introducing new products and not focussed only in oil but also involved in gas field as well as introducing technologies.
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REFERENCES
1. 2. 3.
4. 5.
6. 7.
Google.co.in Wikipedia Ezninearticles.com www.iocl.com Philip Kolter marketing strategy book. Hindustan times article. Economic times article.
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