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|Indian Lube Market Scenario and HPCL’s Plans||By S. Jeyakrishnan, Executive Director (Direct Sales), HPCL|
It’s an exciting time for the Indian Lube Market. India is currently the 3rd largest lube market in the world after US and China, with a size of 1900 TMT in 2011-12, apart from consumption of 650 TMT of Transformer and White Oils. The market is expected to grow at a steady pace of 3 to 4% per annum in the next five years.
Hindustan Petroleum Corporation Limited is the 2nd largest lube marketer in the country and the proud owner of India’s largest Lube Refinery. HPCL attaches great significance to sustainable growth amidst this highly competitive lube market. In order to improve its market share in this market, HPCL has chartered an ambitious growth plan, targeting a top line growth of over 10% CAGR for the next five years. In the backdrop of this plan, we have maintained a growth in line with the target for the current financial year.
In addition to the traditional sales channel of Retail Outlets Network and continued focus on B2B segments, we have also established robust channels of Lube Distributors (for Bazaar Network) and CFAs (for MSME segment). Similarly, for tapping the growing potential of Rural & Semi urban markets, we have made aggressive plans of appointing Rural Distributors. The first lot of such Distributors has already been appointed in Uttar Pradesh & Chattisgarh. We will continue our efforts on rapid expansion of our CFA / Distributor networks in unrepresented markets in the next few years.
Along with the above mentioned initiatives, HPCL has been entering into strategic partnerships for lubes sales with major Original Equipment Manufacturers (OEMs) like Tata Motors, Bajaj Auto, Force Motors, L&T Komatsu, BOSCH, JCB, John Deere, TAFE Motors & Tractors (formerly Eicher) etc. HPCL also gives priority to launch of new products, quality improvements, and innovative packaging and product promotions. Towards this initiative, we have launched products like HP Milcy Turbo Tech – A Diesel Engine Oil meeting API CI4+ credentials for new generation trucks, HP Racer4 Splendid – four stroke engine oil for bikes, HP Kisan Shakti – specially designed engine oil for agricultural pump sets, HP Front Fork Oil, etc. Similarly we have revamped the packs of our flagship brand- HP Laal Ghoda, in the fast moving 1 Lt. & 0.5 Lt. pack sizes.
With the commissioning of Group II / III base oil facility at its Mumbai Refinery in July 2011, HPCL has now become the largest producer of base oils in the country. It will leverage this strength with extra focus on the high end niche products using Group II / III base oil needed for automotive OEMs to meet emission legislations and improved hardware.
The recent commissioning of our new brake oil &coolant manufacturing facility at Silvassa has provided us impetus to improve our market share in the auto specialty segment. Similarly, major up-gradation and de-bottlenecking is underway at our lube plants which will be completed shortly to take care of enhanced blending requirements.
We remain committed to continuing our efforts towards promoting a strong Research and Development base for development of new generation oils like synthetic and semi-synthetic oils, etc. We lay great emphasis on creating and sustaining brand image through product customization and competitive pricing.
We, at HPCL strive to add value to all our stakeholders. Towards this commitment, we are developing comprehensive database of all market influencers like Retailers, Mechanics, Garage owners, Workshops etc. This will enable us to make strategic choices and foster long-lasting relationships with our target customers.
With ever-growing opportunities in the Indian Lube Market, HPCL is poised to capitalize on brand premium, volume growth, value addition and cost efficiency providing benefits to all the stakeholders in a profitable & responsible manner.
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