Final Copy of Summer Internship @Bharat Petroleum Corp.ltd

8/9/2019 Final Copy of Summer Internship @Bharat Petroleum Corp.ltd.

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SUMMER TRAINING REPORT

ON

REQUIREMENTS OF LUBRICANTS IN

SPONGE IRON STEEL & ANCIALLARY

INDUSTRIES AND BAZAAR (RETAIL)

POTENTIAL ASSESMENT.

AT

BHARAT PETROLEUM CORPORATION LTD.

BHUBANESWAR, ORISSA.

PREPARED BY

MR.PRATICK RANJAN GAYEN.ENROLLMENT NO. 08DM070.

BATCH 2008-2010.

UNDER THE GUIDANCE OF

PROF. TANMOY DE. MR.SUBIR MONDAL

INTERNAL GUIDE. COMPANY GUIDE.

AS A PARTIAL FULFILLMENT OFPGDMPROGRAM OF IMIS.

INSTITUE OF MANAGEMENT AND INFORMATION SCIENCE

BHUBANESWAR, ORISSA.

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CONTENTS

CERTIFICATE.DECLARATION.ACKNOWLEDGEMENT.ABSTRACT.

PART 1

INTRODUCTION1.1 COMPANY PROFILE.

1.1. A. BRIEF AND HISTORY.

1.1. B. ORGANISATIONAL STURTURE.1.1. C. MARKETING.1.1. D. FINANCE & ECONOMY.1.1. D. HUMAN RESOURCE.1.1. E. OPERATIONS.1.1. F. RESEARCH AND DEVELOPMENT.

1.2 INDUSTRY PROFILE.

1.2. A. THE LUBRICANT MARKET.1.2. B. BRIEF ABOUT THE COMPETITORS.

PART 2

OBJECTIVES, SCOPES, RESEARCH METHODOLOGY, DATA

ANALYSIS, FINDINGS AND CONCLUSIONS.2.1. OBJECTIVE OF THE STUDY.2.2. SCOPES AND LIMITATION.2.3. RESEARCH METHODOLOGY.2.4. DATA ANALYSIS.

2.4. A. INDUSTRY (BUSINESS-TO-BUSINESS).2.4. B. RETAIL MARKET (BAZAAR).

2.5. FINDINGS AND CONCLUSION.

ANNEXURE.

INDUSTRY (BUSINESS TO BUSINESS).RETAIL MARKET (BAZAAR).

REFERENCES.

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CERTIFICATE .

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DECLARATION .

I Mr. PRATICK RANJAN GAYEN WITHENROLLMENT NO: 08DM070 OF STREAM PGDMFOR YEAR 2008-10, HEREBY DECLARE THAT THIS PROJECT TITLED CONSUMPTION AND

RELEVANCE OF LUBRICANTS IN SPONGE,IRON

,STEEL,ANCUALLARY AND RETAIL MARKETOF

BHARAT PETROLEUM CORPORATION LIMITED

(BPCL) TO BE AUTHENTICATE AND ORIGINAL IN

ALL RESPECT OF THE PROCESS CARRIED OUT INTHIS PROJECT,IF THIS PROJECT COULD BE

SCRUTINIZED AND SCREENED OF COPING,I AM

LIABLE FOR ANY DEMARCATION/VARIATION OF

MARKS WHATSOEVER MY GUIDE OF THISPROJECT DEEMS FIT.

PRATICK RANJAN GAYEN. P.G.D.M

ENROLLMENT NO: 08DM070.BATCH: 2008-2010.

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ACKNOWLEDGEMENT

I express my gratitude to the entire panellist

who took active part in accomplishing my project.

To begin with, I would like to acknowledge my

sincere thanks to Capt. K.S.V. SUBRAMANIUM(Retd.)

CHIEF COORDINATOR (Training & Placement) for

providing me the opportunity to do my summer training

in Bharat Petroleum Corporation Limited (BPCL).

My heartfelt gratitude also goes to my company

guideMr. SUBIR MONDAL, Asstt. Manager Marketing

(Lubes). Who initiated the Midas touch to all the queries

and actually made this project possible by edge.

I would also like to convey my gratitude to my

faculty guide PROF.TANMOY DE (Associate

Professor) who made me walk all the steps of this

project, intricately and helped me in formulating the

entire framework of this analytical research.

Finally, a word of thanks to all my respondents who

spared their valuable time from their busy itinerary in

filling up the questionnaires and made the project

complete.

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ABSTRACT

TITLE OF THE PROJECT: Requirements of lubricants in sponge

iron steel and ancillary industries and bazaar potential assessment oflubes.

NAME OF THE COMPANY: BHARAT PETROLEUMCORPORATION LIMITED.

NAME OF THE INSTITUTE: INSTITUTE OF MANAGEMENTAND INFORMATION TECHNOLOGY.

NAME OF THE GUIDE: PROF.TANMOY DE(FACULTY GUIDE)

MR.SUBIR MONDAL(COMPANY GUIDE).PROJECT PERIOD: 11/5/2009 to 8/7/2009

MAJOR OBJECTIVES OF THE STUDY: To find out the requirements of lubricants in sponge iron steel andancillary industries.

Bazaar potential assessment of lubricants in ANGUL and

DHENKANAL district.

METHODOLOGY: For industry the study was qualitative in natureand based on industries and retailers opinion survey.

DATA SOURCE: Primary data source.

RESEARCH APPROACH: DESCRIPTIVE for industries andEXPLORATORY for retailers.

RESEARCH INSTRUMENT: Separate questionnaires were beingprepared both for industry and retailers where each consisted OPEN-

ENDED, CLOSE-ENDED, CHECKLISTS and STRAIGHT-

FORWARD TYPE QUESTIONS. The mode of collecting the data wasbasically interview-administered and face to face conversations for both

industry and retailers.

SAMPLING PLAN: The main target area for the purpose ofcollecting the sample for the study was ANGUL and DHENKANAL

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where the main target population was SPONGE IRON STEEL & ANILLARY INDUSTRIESand RETAIL SHOPSselling lubricants toconsumers and end-users. Finally PROBABLISTIC CLUSTEREDsampling was done since every industry and retailers had an equal chance

of being selected.

MAJOR FINDINGS:

Price is one of the important parameter for the industries basedupon which they decide for buying lubricants.

Most of industries in both ANGUL and DHENKANAL aresourcing their lubes requirements from distributors rather than directlyfrom the company.

Cumulatively for both the districts the process of checking theperformance level in respective industries is very low, but its different forthat off ANGUL district where level of performance is continuouslychecked and the same is not done in DHENKANAL.

For the bazaar market 2 wheel lubes product are the maximumselling after which diesel products comes second due to the fact that bothANGUL and DHENKANAL are typical industrial belt.

Similarly the most sold pack sizes are that of 7-20 litres pack whichresembles the potential sale of diesel vehicle lubricants.

The important parameter for selecting a particular brand for sellingby the retailers is demand and then is margin.

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PART -1.

INTRODUCTION.

1.1. COMAPANY PROFILE.

1.2. INDUSTRY PROFILE.

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INTRODUCTION

1.1 COMPANY PROFILE .

1.1. A. BRIEF and HISTORY.

BRIEF.

Bharat Petroleum Corporation Limited (BPCL) is one of India's

largest PSU companies, with Global Fortune 500 rank of 287 (2008). Its

corporate office is located at Ballard Estate, Mumbai. As the namesuggests, its interests are in petroleum sector. It is involved in the refiningand retailing of petroleum products.Bharat Petroleum is considered to be a pioneer in Indian petroleumindustry with various path-breaking initiatives such as Pure for Surecampaign, Petro card, Fleet card etc.BPCL's growth post-nationalization (in 1976) has been phenomenal. Oneof the single digit Indian representatives in the Fortune 500 & Forbes2000 listings, BPCL is often referred to as an MNC in PSU garb. It is

considered a pioneer in marketing initiatives, and employs Best inClass practices.Bharat Petroleum Corporation Limited (BPCL) specializes in refining,

processing, and distributing petroleum products. It offers petrol, diesel,aviation fuel, liquefied petroleum gas (LPG) and lubricants. The company

primarily operates in India, where it is headquartered in Mumbai andemploys about13, 968 people.The company recorded revenues of INR1, 112,431 million(approximately $27,632.8 million) in the fiscal year ended March 2008,

an increase of 13% over 2007. Its net profit was INR17, 696 million(approximately $439.6 million) in fiscal 2008, a decrease of 17.5%compared to 2007.

HISTORY.

The 1860s saw vast industrial development. A lot of petroleumrefineries came up. An important player in the South Asian market thenwas the Burmah Oil Company Ltd. Though incorporated in Scotland in

1886, the company grew out of the enterprises of the Rangoon OilCompany, which had been formed in 1871 to refine crude oil produced

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from primitive hand dug wells in Upper Burma. The search for oil inIndia began in 1886, when Mr. Goodenough of McKillop StewartCompany drilled a well near Jaypore in upper Assam and struck oil. In1889, the Assam Railway and Trading Company (ARTC) struck oil atDigboi marking the beginning of oil production in India.

While discoveries were made and industries expanded, John DRockefeller together with his business associates acquired control ofnumerous refineries and pipelines to later form the giant Standard OilTrust. The largest rivals of Standard Oil - RoyalDutch, Shell, Rothschildscame together to form a single organization: Asiatic Petroleum Companyto market petroleum products in South Asia.In 1928, Asiatic Petroleum (India) joined hands with Burmah OilCompany - an active producer, refiner and distributor of petroleum

products, particularly in Indian and Burmese markets. This alliance led tothe formation of Burmah-Shell Oil Storage and Distributing Company ofIndia Limited. A pioneer in more ways than one, Burmah Shell began itsoperations with import and marketing of Kerosene. This was imported in

bulk and transported in 4 gallon and 1 gallon tins through rail, road andcountry craft all over India. With motor cars, came canned Petrol,followed by service stations. In the 1930s, retail sales points were builtwith driveways set back from the road; service stations began to appearand became accepted as a part of road development. After the warBurmah Shell established efficient and up-to-date service and fillingstations to give the customers the highest possible standard of service

facilities.

FROM BURMA SHELL TO BHARAT PETROLEUM .

Burmah Shell Refineries was incorporated as a company in 1952,and established a refinery in Mahul .On 24 January 1976, the BurmahShell Group of Companies was taken over by the Government of India toform Bharat Refineries Limited. On 1 August 1977, it was renamedBharat Petroleum Corporation Limited. It was also the first refinery to

process newly found indigenous crude Bombay High, in the country.

BHARAT PETROLEUM then and after

The company installed microprocessor based digital integrated

distributed control systems in catalytic reformers and introduced a newsolvent unit to replace the pneumatic control system in 1993.Thecompany also installed an advanced control system for its catalyticcontrol unit. The company then incorporated a joint venture company,

Bharat Oman Refineries, in 1994.There after BPCL signed amemorandum of understanding (MOU) with Bank of Baroda in 1995 to

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launch the first co-branded credit card in the country. In 1998, BPCLentered into a joint venture with Petronet (India) for the construction of a308 km pipeline from Kochi in Kerala to Karur in Tamil Nadu. Thefollowing are a few achievement achieved by BHARAT PETROLEUMCORPORATION LTD:

McDonald's made an agreement with BPCL to open andrun restaurants at selected petrol pumps across the countryin 2000. Quicky's, the global coffee chain, followed suit in2001, and began ton offer its services at BPCL stores.

BPCL launched Speed '93, its own brand of petrol, in2003. In the following year, BPCL diversified itsoperations. The company entered into a business to

business e-commerce arrangement with IDBI Bank toprovide an automated payment and purchase process toBPCL's corporate and industrial clients. The companyalso tied up with Tata Consultancy Services to providemedical advisory and counselling services at Ghar, thehighway retailing initiative of BPCL.

Bharat Petroleum Corporation Limited and GAIL formedanother joint venture company, Central UP Gas, forimplementation of City Gas Projects in Delhi and Kanpurin 2005.

In 2006, the Government of the Sultanate of Oman signedan Exploration and Production Sharing Agreement(EPSA) for the on land exploration block 56 with theconsortium comprising BPCL, Oilex (Operator),Hindustan Petroleum Corporation Limited, GAIL Indiaand Videocon Industries. In the same year, the companyacquired a 20% interest in an exploration block inAustralia.

In September 2008, BPCL and Videocon Industries Ltdacquired 50% stake in Brazil's EnCana Brasil PetroleoLimeade.

BPCL and GAIL (India) Limited announced to form a joint venture company, Gods Own Gas Company, formarketing compressed natural gas (CNG) and piped gas inKerala and Karnataka, in March 2008.

In April 2008, BPCL announced the formation of jointventure Company in consortium with other companies,

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Shapoorji Pallonji Co Ltd and Nandan Biomatrix Ltd forestablishment of Bio Diesel Value Chain in Uttar Pradesh,India. In the same month, BPCL and GAIL (India)Limited signed an MOU for cooperation in transmissionand distribution of natural gas, LPG pipelines and city

gas.

In August 2008, Punjab Energy Development Agency(PEDA) signed a MoU with BPCL to setup one M/WSolar Photovoltaic Power Plants at Lalru in Punjab, India.

KEY EMPLOYEES:

Name Job Title BoardAshok Sinha Chairman& Managing Director Executive Board

S. Mohan Director, Human Resources Executive Board

S.Radhakrisnan Director, Marketing Executive Board

R K Singh Director, Refineries Executive Board

S K Joshi Director, Finance Executive Board

S K Barua Director Non Executive Board

Rama Bijapurkar Director Non Executive Board

A H Kalro Director Non Executive Board

N Venkiteswaran Director Non Executive Board

P H Kurian Director Non Executive Board

P K Sinha Director Non Executive Board

MAJOR PRODUCTS AND SERVICES:

Bharat Petroleum Corporation Limited (BPCL) refines, stores,

markets and distributes petroleum products. The companys key productsand services include the following:

PRODUCTS:

I. Petrol

II. Diesel

III. LPG

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IV. Gasoline

V. Kerosene

VI. Lubricants

VII. Aviation fuel

VIII. Fuels and solvents

SERVICES:

I. Convenience stores

II. ATMs

III. Car washes

IV. Free air and water

V. Lubricant top-ups

VI. Energy audits

VII. E-banking services

VIII. Consultancy and technical services

IX. Online ordering

1.1. B.COMPANY STUCTURE.

The older structure was functionally organized. There weremainly four functions (refineries, marketing, finance and personnel) each

headed by an executive director reporting to the (CMD). Other supportdepartments like corporate affairs, legal, audit, vigilance, coordinationand company secretary were directly under the CMD. See Appendix 1 forthe organizational chart. The Director refinery was in charge of refinery,corporate planning, JV refineries and special projects. Other thancorporate finance and marketing finance EDP was also under the Directorfinance. In marketing, there were different departments for retail,industry, LPG, lubricants and aviation segments. Corporatecommunication was also under Director marketing.

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The whole of India was divided into four regions andfurther into 22 divisions. Each region was headed by a RegionalManager who was in charge of all activities within the region andreported to the Director marketing. Each region had a manager in chargeof each of regional personnel, regional engineering, regional industrial

customers, regional retail, and regional finance. Regional LPG was underregional industrial customers. The division was the responsibility of theDivisional Manager reporting to the Regional Manager. He had amanager each for sales, operations and engineering. Each of these wasresponsible for sales, depots and engineering respectively for all thecustomer segments.

Across the marketing function, except for the corporatedepartments (LPG, industrial customer, etc.) specifically looking after acustomer segment, every individual and role is focused on multiplecustomer segments. For example any strategy addressing the industrialcustomers originates from the Corporate Department (IndustrialCustomer), goes via the Director Marketing, Regional Manager,Divisional Manager to the Sales Officer. All of them are responsible formultiple customer segments like retail, LPG, industrial, etc and deal withdifferent classes of customers. Hence there was very low customerawareness in terms of the unique needs of the different customersegments, with no single individual at the operational level having clarityon any single customer segment. Moreover, the marketing strategy was

formulated by people who were far from the customer with very lowunderstanding of the customer they were targeting. The implementerswere responsible for diverse customers with a low understanding of thelogic of these strategies meant for each customer segment. Thus the oldstructure had created a bottleneck between the strategy formulators andimplementers in terms of the regional structure, and between the fieldstaff and the corporate offices and refinery.

Activities of a business process are spread out across different

functions and levels of hierarchy, engaging many individuals. There wasa long chain of non value adding linkages between any two activitiestargeting a business / customer. For example, when an industrialcustomer gives a special order of lubes to the sales officer, the corporatelubes purchases the base oil, plant blends it, S&D packs it and the salesofficer sells it. The Sales Officer would communicate the order to theDivisional Manager, who passes it on to the Regional Manager. Then theorder would be routed to the Corporate Lubes for processing. Everyoneinvolved in the activities of this process belong to different functions and

hierarchy levels. This long chain of communication had led to a lack of

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customer orientation, low awareness of customer needs and expectationsand slow response.

APPENDIX-1.ORGANISATIONAL STRUCTURE OLD AND

NEW.

THE GIVEN DIAGRAM SHOWS THE STUCTURE OFBHARAT PETROLEUM OF BOTH STRUCTURAL ANDDIVISIONAL.

REGIONAL STRUCTURE OLD. (ABOVE)DIVISIONAL STUCRTURE (BELOW).

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REGIONALHEAD.

REGIONALPERSONAL.

REGIONALS & D.

REGIONALENGINEERING.

REGIONALSALES.

REGIONALFINANCE.

REGIONALL.P.G.

DIVISIONAL HEAD.

MANAGER SALES.MANAGER

OPERATIONS.MANAGER

ENGINEERING.

HEAD SALES.

SALES OFFICER. DEPOTS. ENGINEERING.


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CMD

DIRECTOR(REFINERIES).

CORPORATEPLANNING

JVREFINEERIES

SPECIALPORJECT.

REFINERY

DIRECTOR(PERSONNEL)

PERSONNEL& ADMIN

HUMANRESOURCE.

DIRECTORMARKETING

DIRECTORFINANCE.

FINANCECORPORATE.

FINANCEMARKETING.

E D P

REGIONAL HEAD.

AVIATION.

S & DCORPORATE

CORPORATECOMMUNICATION

INTERNALTRADE

H.S.E

LUBEDCORPORATE.

L P GCORPORATE.

SALESCORPORATE.

E & PMARKETING.

COMPANYSECRATARY

CORPORATEAFFAIRS.

LEGAL

AUDIT

VIGILLANCE.

COORDINATION


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CORPORATE STRUCTURE OLD.

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CMD.

CORPORATE

PLANNING

JV

REFINEERIES

SPECIAL

PROJECT.

IT & SUPPLY

R & D.

MUMBAI

REFINERY.

DIRECTOR

PERSONNEL.

HR

SERVICES.

HR

CORPORATE.

DIRECTOR

MARKETING.

DIRECTOR

FINANCE.

FINANCE

CORPORATE

CORPORATE

TREASURY

INFORMATIONSYSTEM

CORPORATE

STRATEGY

BRAND/CORPORA-

TE

COMMUNICATION

H S E

IND/COMM

BUSINESS.

LUBES

BUSINESS.

LPG

BUSINESS.

RETAIL

BUSINESS.

AVIATION

BUSINESS.

Company

Secretary

Corporate

Affairs

Legal

Audit

Vigilance

Coordination

E & P

DIRECTOR

(REFINERIES)


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CORPORATE STRATEGY NEW.

BHARAT PETROLEUM-THE NEW SBUFORM STRUCTURE

The new structure was focused on the business processes andthe customer. The new structure at the top management level is the same.Five SBUs Retail, Lubes, Industry/Commercial, LPG and Aviation arecustomer centered SBUs and come under the director (marketing). Thesixth SBU, Refinery along with two new departments IT & Supply Chain

and R&D are under the director (refineries). Each SBU would have itsown HR, IS, finance, logistics, sales, engineering, etc. The number oflayers in the organization was reduced to four from six or seven.

The major change is the introduction of the territories covering asmaller geographical area and focusing on specific customer segments. Inretail SBU the new structure had 66 territories reporting to the fourregional offices, where as in the earlier structure there were only 22divisions which catered to all segments. In other SBUs the regional officewas removed and territories were designed to directly report to the SBU

heads. Each territory team leader was responsible for sales in the territoryonly for a specific product. The territory structure was designed to enablethe field staff to focus on specific customer segments. Authority was alsodelegated down the hierarchy and decision making pushed to the lowest

possible levels. Decisions earlier taken at the regional level were takennow at the territory level. Further authority was delegated to the role andnot the hierarchy level. Administrative offices have been moved to supplylocations that consist of 125 terminals for main fuels and 35 LPG bottlingones. In LPG SBU head office there are only nine personnel and acrossthe territories even managers at senior positions have been forced to get

business.

The new design incorporated recalibration of roles andresponsibilities and redeployment of more than two thousand people(around one fifth of total employee strength) across the organization. Itcreated new roles at the front effectively using redundant manpower toincrease customer interface and interaction.

SOME SALIENT FEATURES OF THE NEW STRUCTURE ARE:

Highly empowered work force

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Decentralized decision making

De-linking of authority from hierarchical levels

Orientation towards internal and external customers

Regular market research and customer surveys

Conscious brand building efforts

1.1. C.MARKETING.

Bharat petroleum understands peoples need as customers

and relentlessly work towards fulfilling them, working consciously

towards providing added value in fuel and non-fuel areas. The

Corporation offers products and services that have been designed to meet

the need gaps of its customers. It is not easy as BPCLs customer base is

a diverse one demanding of them to perform better and satisfy the needs

of some of their customers who fly in the air to the larger Indian populacewho survive on Kerosene as their cooking fuel.

FUELLING AUTOMOTIVES.

Vehicle owners are always on the lookout for new offerings

as well for tips & pointers to keep their vehicles in top shape. BPCLunderstand their requirements and have consistently tried to satisfy their

needs. Information about all the high-class fuels for vehicle as well as the

lubricants is always updated to keep wheels running smoothly.

OFFERING WORLD CLASS FUELS.

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Since 2002, BPCL have introduced new generation branded

fuels Speed, Hi Speed Diesel and Speed 97, being the pioneers to

introduce premium fuel brands in the Country. These specialized

products BPCL launched in line with global trends and keeping pace with

the technological advancements in the automobile industry leading to

introduction of new generation vehicles. Speed brand of petrol contains

multi-functional fuel additives that prevent formation of harmful deposits

and help clean existing deposits, thereby improving vehicle performance.

SPEED has been the market leader in the branded fuels category. BPCL

has also introduced a high-end Octane 97 variant Speed 97 catering to the

requirement of vehicles at the upper end of the tier. To meet the growing

needs of the diesel passenger car segment, BPCL also introduced Hi-

Speed Diesel which is a blend of diesel and world-class multi-functional

additive which uses the internationally renowned Green Burn

Combustion Technology. This multi-functional additive enables the high

performance vehicles to deliver their designed outputs by removing

harmful deposits from all fuel metering systems and components. This

also reduces particle level, black smoke and provides longer engine life.

SERVICING THE CUSTOMERS NEED.

BPCL recognized the customer need for pure quality andcorrect quantity of fuel for their vehicles and launched the flagshipinitiative of Pure For Sure (PFS) offering the guarantee of pure qualityand correct quantity of fuel to our customers. The petrol pumpsdisplaying a prominent Pure For Sure signage have become landmarkdestinations as the movement has gained momentum across our Retail

Network.BPCL now offer a robust and automated network of retailoutlets, which leverage technology to deliver the assurance of quality and

quantity promise, ensure integration of payment with fuelling andimproves the service efficiency at the forecourt of the petrol pump.

FOSTERING LOYALTY.

BPCL share rewarding relationships with their customersand building loyalty has been a centre of focus with them. Recognizingthe need of their customers to make life more convenient and rewardingand introduced the first loyalty-cum-rewards program, PetroBonus.

Equipped with Smart Card Technology, the Petro Card programcombines convenience in payment along with an inbuilt rewards program

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that rewards the customer with Petromiles every time he fuels. A similarprogram, Smart Fleet was launched for Fleet Owners. The SmartFleetProgramme offers the fleet owner an unbeatable convenience, securityand a host of privileges such as cashless transactions, vehicle tracking,Credit Option for Fleet Owners and Cash Management System.

CARING FOR CUSTOMERS VEHICLE NEED.

BPCL also aim to provide service centre facilities throughtheir V-CARE (Vehicle Care) Centres across the urban network. The V-Care Centres provide customers with reliable, transparent and value formoney services for the basic vehicle care needs. BPCL have tie ups withHero Honda and General Motors for being their authorized After SalesService Centres apart from the other brands of cars and two-wheelers.

With BPCLS reach to the nook & corner of the country they are alwaysnear to their customers.

PARTNERING HIGHWAY JOURNEY.

On the highways, BPCL offer a home away from home tothe truckers and the tourists in the form of the GenerationNext

OSTSs/OSTTSs (One Stop Truck cum Tourist Shop) branded as GHAR.

These outlets are built on a minimum of 3 to 5 acres plot sizes and house

dedicated and fully automated MS/HSD petrol/ diesel Fuelling facilities

to fuel all kinds and sizes of vehicles besides the specially designed

offerings for the highway travelers, that include a Food Court for Tourists

and a Dhaba for truckers, a dormitory with beds, a Safe, Secured and

Spacious parking for trucks and cars, a vehicle wash facility, Saloon,Laundry and Tailor shop, a Kirana shop, Bathing facilities, dedicated

toilets for Truckers and dedicated toilets for Tourists (Gents, Ladies &

Handicapped),Childrens Play area, Amphitheatre for entertainment,

Health care centre, Smartfleet Customer service centre ,Sanjha Chula for

self cooking and captive power generation. Assuring a network of outlets

on the highway shows our commitment to serve our highway customers

with as much care as in the key cities.

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AUTO L.P.G.-THE INTRODUCTION OF LPG AS AUTO

FUEL.

With the menace of rising vehicular pollution, use of LPGas an auto fuel was proposed as a pollution abatement measure. LPG

being a clean environmentally friendly fuel, will reduce air pollution to agreat extent if the vehicles are fuelled with LPG. Bharat Petroleum wasthe first Oil Company to take the initiative for setting up of an Auto LPGDispensing Station (ALDS) and run vehicles on LPG as a pilot project inDelhi in October 1999.BPCL today have over 70 Auto LPG DispensingStations (ALDS) in various cities (including metros) in the country.

BRAND MANAGEMENT.

In the highly competitive scenario, it has becomeimperative to own dominant brands. The Brand Management team atBharat Petroleum endeavours to build and manage a strong brand imagereflecting Bharat Petroleum's core values of being 'INCARE',viz.

INnovative, CAring and REliable. Emphasis is laid on continuouslyunderstanding customer behaviour, tracking their changing needs andexpectations, and meeting these needs in the most cost-effective manner.

STRATEGY DEVELOPMENT.

Bharat Petroleum recognises that all strategic initiatives mustconform to the overall vision of the Corporation and improve theeconomic value. The Strategy Development effort at the corporate levelachieves better focus in the new organisational structure, besidesfacilitating the SBUs in developing their respective strategies that lead toan integrated Corporate Strategy. A Business Planning process has been

put in place that not only provides opportunities for the SBUs to pursuetheir visionary goals in consonance with the Corporate Vision, but alsocontinuously monitors trends and identifies strategic opportunities for theCorporation.

ON 16TH APRIL, 2009 BPCL LIFTEDMARKETINGCOMPANYOF THE YEAR AWARD AGAIN AFTER 2008.

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1.1. D.FINANCE AND ECONOMIC.

BPCL is primarily an energy processing and marketingcompany and a Public Sector Undertaking (PSU). The centralgovernment of India holds a stake of 54.93% in the company and thestate government of Kerala has a shareholding of 0.86%. Although BPCLexport products to other countries, particularly those in the South Asianregion, BPCLs focus on their principal and most important market,India, is unwavering. It is projected that the energy needs and the demandof the country will increase significantly in step with economic growth.The demand for oil and petroleum products is also expected to increasesimultaneously. The Planning Commission of India has projected thatdemand for oil will increase by over approximately 20% from 2005-06

levels by 2012.To meet the challenge of an evolving and growing market,BPCL have designed and deployed various strategies that will help us notonly to meet the energy needs but also fulfil their responsibility toshareholders and contribute towards inclusive growth. BPCLs revenuesincreased by about 12% though Profit after Tax (PAT) decreased by12.26% when compared to previous years. Their total capital expenditurewas Rs.20.66 Billion for the financial year 2007-08, as compared toRs.18.34 billion during the year 2006-07. During the year 2007-08, theaverage cost of Indian crude basket was significantly higher than the

corresponding figure of the previous year. Due to volatility in crude prices, OMCs in India faced a considerable strain in their liquidity.BPCLs profits have suffered due to the rising under-recoveries arisingout of subsidies on SKO, domestic LPG, and also Motor Spirit and HighSpeed Diesel under-recoveries due to price regulation by the government.As a means to compensate this, Government of India set up a mechanismfor sharing this subsidy burden. Out of the total under recoveries, one-third was shared by the PSUs in upstream sector through discounts oncrude purchased, one-third by Governments Oil bonds and balance by

OMCs. New ideas are also being tested and tried in BPCLs retailbusiness, so as to maximize the advantage that they possess by havingestablished retail outlets spread across the country. As a result ofaggressive marketing, the retail business was able to achieve animpressive growth of 13% compared to the previous year.

1.1. E. HUMAN RESOURCE.

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Starting in August 2002, Bharat Petroleum, under the aegisof the Public Enterprises Selection Board, in association with the HayGroup, conducted an empirical research study, the first of its kind, toidentify leadership competencies necessary for Indian CEOs. The studywas conducted under rigorous methods developed at the McClelland

Centre for Innovation and Research at Boston. These included criterionsampling, Behavioural Event Interviews, expert panels, coding, conceptformation, performance outcome analysis and validation.

The outcome of that study is The Indian CEOCompetency Model, wherein Competencies for Success were drawn up,

providing keys to outstanding Indian Corporate Leadership in our time.The model comprised 11 competencies, that can be arranged in fourgroups or clusters, which are:

SOCIAL RESPONSIBLE BUSINESS EXECELLENCE.1. Adaptive Thinking.2. Entrepreneurial Drive.3. Excellence in Execution.

ENERGIZING THE TEAM1. Driving Change.2. Team Leadership.3. Empowerment with Accountability

MANAGING ENVIRONMENT

1. Networking.2. Organizational Awareness.3. Stakeholder Influence.

INNER STRENGTH.Executive Maturity.Transcending Self.

Qualities such as change and team leadership, accountability,empowerment, networking and executive maturity are some of the

critical dimensions of leadership highlighted in this book. It also charts acountrywide blueprint of how CEOs think, act and feel and exhibittypical effective behaviours worthy of emulation. The findings of thisstudy would help in providing food for thought for existing leaders, aswell as developing future leaders and benchmarking their skill-sets,strategies and successes. The few of other common human resourceactivities undertaken by BPCL are as:

Efficiently supervising a team of 150 members.

Effective day-to-day office management.

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Ensuring complete logistics and administrative support forconducting meetings.

In charge of office correspondence and mail management functions.

Training need analysis Induction programmes Arrangement;Manpower/Recruitment planning

Preparation of annual targets for personnel.

Coordinating Staff appraisals.

Good Interpersonal skills; Adept at Indenting and inventory of

office stationery.

Manifested expertise in organizing social functions forstaff members as a part of boosting industrial relation.

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1.1. E. OPERATIONS.

The core business operations of Bharat Petroleum are PetroleumRefining. It belongs to the oil & gas operations industry. Although itcarries the ancient Sanskrit name for India (Bharat), Bharat PetroleumCorporation Limited (BPCL) is a modern refining and distributioncompany. It vies with Hindustan Petroleum for the #2 slot behind

Indian Oil. The company processes petroleum and petroleum products;its refinery in Mumbai processes 260,000 barrels of crude per day. It also

controls refineries in Kochi and Numaligarh. BPCL sells engine oils andgasolines, liquefied petroleum gas (LPG), and kerosene. It has more than6,550 gas stations, more than 1,000 kerosene dealers, and a nationalnetwork of LPG distributors. The Indian government owns 55% of thefirm, although it plans to sell this stake as part of industry widederegulation. The various other operational functions of BPCL are as:

APRON FUEL MANAGEMENT SYSTEM & E-BIZ SOLUTION.

BPCL is the first and only oil company in India to implementApron Fuel Management System which is a powerful andcomprehensive system that combines the vehicle (Point of Sale) and

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office support functions into a single seamless interface reducing humanintervention and enhancing accuracy. BPCL also provides E-Biz solutionto their customers.

OVERSEAS PROJECTS.

BPCL Aviation SBU has entered into a contract with Larsen& Tourbo-ECC Division and is rendering its expertise to M/s L & T -ECC Division for successful completion of New Aviation Fuel Depot atKuwait for Kuwait Aviation Fuelling Company (KAFCO).The scope ofservice includes Technical Consultancy by Aviation/Engineering &Projects specialists having domain expertise, Preparation of Pre-Commissioning and Commissioning procedures. BPCL is assisting in

performing Pre-Commissioning and Commissioning of entire facility atKAFCO project, training of Owner's personnel in India (Class roomtraining) and on job training at KAFCO site, Kuwait, participation inHAZOP/SIL/ALARP study and assistance to evaluate remedy on thefindings as advised by HAZOP committee chairman (i.e.recommendations by 3rd party from that study), assistance inProcurement related activities and preparations of Operations&Maintenance and QC Manual.

HYDRANT OWNERS & OPERATOR AND EQUITY ATCIAL.

BPCL is the first oil company to participate in Greenfield airportin India. BPCL hold equity stake in Cochin International Airport Ltd.which is the first airport built under private-public participation and havestate of art hydrant refuelling system at the airport built by them.

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1.1. F.RESEARCH AND DEVELOPMENT.

Over the years, Bharat Petroleum continues to meet thechallenges of the rapidly changing environment, leading to changes in themarketing of products and services. In all these changes, only one factor

has remained constant and has been the source of Bharat Petroleum'sstrength and inspiration for any future innovations - Bharat Petroleum's

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People. The feeling of ownership has facilitated all employees tounderstand the complexity of the market and needs of the customers, andrespond to these needs with innovative initiatives and offerings.

Research and development Centre always on the forefront to

innovate, Bharat Petroleum is making distinct efforts towards Researchand Development (R and D). Besides the R and D facilities at theRefinery and the Product Application Development Centre in Sewree inMumbai, a new state-of-the-art RandD Centre is being set up near Delhi.The R and D Centre is being organised around three core groups Process and Technology Development, Product ApplicationDevelopment and Environmental Engineering. A total outlay of Rs.3,000million has been planned to be spent in three phases up to the year 2003-04 on this project.

BHARAT PETROLEUM- THE TECHNOLOGICAL EDGE.

Bharat Petroleum has always been on the forefront ofharnessing technology initiatives for BPCL has been on forefront inharnessing technology. Maximising efficiency and achieving greatercustomer satisfaction.

Bharat Petroleum is the first Public Sector Oil Company toimplement Enterprise wide Resource Planning (ERP) solutions - SAP.The implementation project known as ENTRANS (Enterprise wideTransformation) has been awarded the 'SAP Star Implementation Award',with Bharat Petroleum having the distinction of executing the largest andthe most ambitious SAP project in India. The challenge of SAPimplementation was to ensure that all the integrated elements (of thecomplex multi-modular integrated solutions that impact the entireworkflow of the organisation) work seamlessly across the length and

breadth of the country, including the remote locations. Providing onlineconnectivity in these remote locations, given the full-fledged IT networkinfrastructure, was in itself a daunting task.

Bharat Petroleum is reaping the benefits of the integratedsystem in many areas of its operations. The early gains of implementationare in the areas of tracking customer-receivables, monitoring credit-management, inventory management, besides easing the operations in alarge number of areas.

Furthermore, Bharat Petroleum has also set up one of thebiggest 'Centres of Excellence' in Asia to provide online support to the

end users and also work towards continuous improvement in businessprocesses and handle product upgrades and new generation products.

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With SAP as the IT backbone, Bharat Petroleum plans to takeadvantage of the Internet based capabilities along the entire value chainwith a Customer Relationship Management solution. A large datawarehouse project has also been implemented, which facilitates access to

real-time accurate information on key performance indicators at allBharat Petroleum locations. This enables the management to takestrategic and business decisions, thus ensuring value-added services,

better customer satisfaction and enhanced

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1.2. INDUSTRY PROFILE.

1.2. A. THE LUBRICANT MARKET.

The global lubricant market is generally competitive withnumerous manufacturers and marketers. Overall the western market may

be considered mature with a flat to declining overall volumes while thereis strong growth in the emerging economies. The lubricant marketersgenerally pursue one or more of the following strategies when pursuing

business:

SPECIFICATION.

The lubricant is said to meet a certain specification. In theconsumer market, this is often supported by a logo, symbol or words thatinform the consumer that the lubricant marketer has obtained independentverification of conformance to the specification. Examples of theseinclude the APIs donut logo or the NSF tick mark. The most widely

perceived isSAE viscosity specification, like SAE 10W-40. Lubricityspecifications are institute and manufacturer based. In the U.S. institute:

API Sfor petrol engines,API Cfor diesel engines. For 2007 the current

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specifications areAPI SMandAPI CJ. Higher second letter marks betteroil properties, like lower engine wear supported by tests. In EU the

ACEA specifications are used. There are classes A, B, C, and E withnumber following the letter. Japan introduced theJASO specification formotorbike engines. In the industrial market place the specification may

take the form of a legal contract to supply a conforming fluid or purchasers may choose to buy on the basis of a manufacturers ownpublished specification.

ORIGINAL EQUIPMENT MANUFACTURER (O.E.M) APPROVAL.

Specifications often denote a minimum acceptable performancelevels. Thus many equipment manufacturers add on their own particularrequirements or tighten the tolerance on a general specification to meettheir particular needs (or doing a different set of tests or using

different/own test bed engine). This gives the lubricant marketer anavenue to differentiate their product by designing it to meet an OEMspecification. Often, the OEM carries out extensive testing and maintainsan active list of approved products. This is a powerful marketing tool inthe lubricant marketplace. Text on the back of the motor oil label usuallyhas a list of conformity to some OEM specifications, such as MB, MAN,Volvo, Cummins, VW, BMW or others. Manufactures may have vastlydifferent specifications for the range of engines they make; one may not

be completely suitable for some other.

PERFORMANCE.

The lubricant marketer claims benefits for the customer basedon the superior performance of the lubricant. Such marketing is supported

by glamorous advertising, sponsorships of typically sporting events andendorsements. Unfortunately broad performance claims are common inthe consumer marketplace, which are difficult or impossible for a typicalconsumer to verify. In the B2B market place the marketer is normallyexpected to show data that supports the claims, hence reducing the use of

broad claims. Increasing performance, reducing wear and fuelconsumption is also aim of the laterAPI, ACEA and car manufacturer oilspecifications, so lubricant marketers can back their claims by doingextensive (and expensive) testing.

LONGEVITY.

The marketer claims that the lubricant maintains its performanceover a longer period of time. For example in the consumer market, a

typical motor oil change interval is around the 3000-6000 miles (7500-15000 km). The lubricant marketer may offer a lubricant that lasts for

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12000 (30000km) miles or more to convince a user to pay a premium.Typically, the consumer would need to check or balance the longer lifeand any warranties offered by the lubricant manufacturer with the

possible loss of equipment manufacturer warranties by not following itsschedule. Many car and engine manufacturers support extended drain

intervals, but request extended drain interval certified oil used in thatcase; and sometimes a special oil filter. Example: In older Mercedes-Benz engines and in truck engines one can use engine oil MB 228.1 for

basic drain interval. Engine oils conforming with higher specification MB228.3 may be used twice as long, oil of MB 228.5 specification 3x longer.

Note that the oil drain interval is valid for new engine with fuelconforming car manufacturer specification. When using lower grade fuel,or worn engine the oil change interval has to shorten accordingly. Ingeneral oils approved for extended use are of higher specification andreduce wear. In the industrial market place the longevity is generallymeasured in time units and the lubricant marketer can suffer largefinancial penalties if their claims are not substantiated.

EFFICIENCY.

The lubricant marketer claims improved equipment efficiencywhen compared to rival products or technologies, the claim is usuallyvalid when comparing lubricant of higher specification with previousgrade. Typically the efficiency is proved by showing a reduction in

energy costs to operate the system. Guaranteeing improved efficiency isthe goal of some oil test specifications such as API CI-4 Plus for dieselengines. Some car/engine manufacturers also specifically request certainhigher efficiency level for lubricants for extended drain intervals.

OPERATIONAL TOLERANCE.

The lubricant is claimed to cope with specific operationalenvironment needs. Some common environments include dry, wet, cold,hot, fire risk, high load, high or low speed, chemical compatibility,atmospheric compatibility, pressure or vacuum and various combinations.The usual thermal characteristics are outlined with SAE viscosity givenfor 100C, like SAE 30, SAE 40. For low temperature viscosity the SAE-xxW mark is used. Both markings can be combined together to form aSAE 0W-60 for example. Viscosity index (VI) marks viscosity changewith temperature, with higher VI numbers being more temperature stable.

ECONOMY.

The marketer offers a lubricant at a lower cost than rivalseither in the same grade or a similar one that will fill the purpose for

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lesser price. (Stationary installations with short drain intervals.)Alternative may be offering a more expensive lubricant and promisereturn in lower wear, specific fuel consumption or longer drain intervals.(Expensive machinery, un-affordable downtimes.)

COMPOSITION.

The marketer claims novel composition of the lubricant whichimproves some tangible performance over its rivals. Typically thetechnology is protected via formal patents or other intellectual property

protection mechanism to prevent rivals from copying. Lot of claims inthis area are simple marketing buzzwords, since most of them are relatedto a manufacturer specific process naming (which achieves similar resultsthan other ones) but the competition is prohibited from using a trademark.

QUALITY.

The marketer claims broad superior quality of its lubricantwith no factual evidence. The quality is proven by references to famous

brand, sporting figure, racing team, some professional endorsement orsome similarsubjective claim. All motor oil labels wear mark similar to"of outstanding quality" or "quality additives," the actual comparativeevidence is always lacking.

1.2. B.BRIEF ABOUT THE COMPETITORS.

THE FOLLOWING ARE THE TOP FIVE COMPETITORS OFBHARAT PETROLEUM CORPORATTION LIMITED:

INDIAN OIL CORPORATION LIMITED.

Indian Oil Corporation is an Indian public-sector petroleum

company. It is Indias largest commercial enterprise, ranking 116th on theFortune Global 500 listing (2008). It began operation in 1959 as IndianOil Company Ltd. The Indian Oil Corporation was formed in 1964, withthe merger of Indian Refineries Ltd. Indian Oil and its subsidiariesaccount for a 47% share in the petroleum products market, 40% share inrefining capacity and 67% downstream sector pipelines capacity in India.The Indian Oil Group of Companies owns and operates 10 of India's 19refineries with a combined refining capacity of 60.2 million metric tons

per year. On 30th June 2009 Indian Oil will complete 50 years of its

existence and a series of events are being planned to celebrate its GoldenJubilee Year.

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in 1984-85 to an impressive Rs 1,03,837 Crores in FY 2007-08. HPCLalso owns and operates the countrys largest Lube Refinery, producingLube Base Oils of international standards. With a capacity of 335,000Metric Tonnes. This refinery accounts for over 40% of the countrys totalLube Base Oil production.

The vast marketing network of the Corporation consists ofZonal offices in the 4 metro cities and over 85 Regional offices facilitated

by a Supply & Distribution infrastructure comprising Terminals, AviationService Stations, LPG Bottling Plants, and Inland Relay Depots & RetailOutlets.

RELIANCE INDUSTRIES LIMITED.

Reliance Industries Limited (NSE: RELIANCE) is India's

largest private sector conglomerate (and second largest overall) with anannual turnover of US$ 35.9 billion and profit of US$ 4.85 billion for thefiscal year ending in March 2008 making it one of India's private sectorFortune Global 500 companies, being ranked at 206th position (2008). Itwas founded by the Indian industrialist Dhirubhai Ambani in 1966.Ambani has been a pioneer in introducing financial instruments like fullyconvertible debentures to the Indian stock markets. Ambani was one ofthe first entrepreneurs to draw retail investors to the stock markets.Critics allege that the rise of Reliance Industries to the top slot in terms of

market capitalization is largely due to Dhirubhai's ability to manipulatethe levers of a controlled economy to his advantage. Though thecompany's oil-related operations form the core of its business, it hasdiversified its operations in recent years. After severe differences betweenthe founder's two sons, Mukesh Ambani and Anil Ambani, the group wasdivided between them in 2006. In September 2008, Reliance Industrieswas the only Indian firm featured in the Forbes's list of "world's 100 mostrespected companies".

CHENNAI PETROLEUM CORPORATION LIMITED.

Chennai Petroleum Corporation Limited (CPCL), formerlyknown as Madras Refineries Limited (MRL) was formed as a jointventure in 1965 between the Government of India (GOI),AMOCO and

National Iranian Oil Company (NIOC) having a share holding in the ratio74%: 13%: 13% respectively. From the grassroots stage CPCL Refinerywas set up with an installed capacity of 2.5 Million Tonnes Per Annum(MMTPA) in a record time of 27 months at a cost of Rs. 43 crore withoutany time or cost over run.

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In 1985, AMOCO disinvested in favour of GOI and theshareholding percentage of GOI and NIOC stood revised at 84.62% and15.38% respectively. Later GOI disinvested 16.92% of the paid up capitalin favour of Unit Trust of India, Mutual Funds, Insurance Companies andBanks on 19 May 1992, thereby reducing its holding to 67.7 %. The

public issue of CPCL shares at a premium of Rs. 70 (Rs. 90 to FIIs) in1994 was over subscribed to an extent of 27 times and added a largeshareholder base of over 90000.As a part of the restructuring steps takenup by the Government of India, Indian Oil Corporation Limited (IOCL)acquired equity from GOI in 2000-01 Currently IOC holds 51.88% while

NIOC continued its holding at 15.40%. In view of the CPCL becomesubsidiary of IOCL in 2001. The Manali Refinery has a capacity of 9.5MMTPA and is one of the most complex refineries in India with Fuel,Lube, Wax and Petrochemical feedstock production facilities. CPCL isalso the company where NRI businessman Mr.C.Sivasankaran worked asa fabrication contractor.

MANAGLORE REFINERY AND PETROCHEMICALS LIMITED.

Mangalore Refinery and Petrochemicals Limited (MRPL), locatedat Katipalla, north from centre of Mangalore city, is a state-of-the-artGrass root Refinery at Mangalore and is a subsidiary of ONGC, set up in1998.The refinery was established after displacing five villages of Bala,Kalavar, Kuthetoor, Katipalla, and Adyapadi.

The refinery has a versatile design with high flexibility to processcrudes of various API and with high degree of automation. MRPL has adesign capacity to process 9.69 million metric tonnes per annum and isthe only refinery in India to have two hydrocrackers producing premiumdiesel (high cetane). It is also the only refinery in India to have two CCRs

producing unleaded petrol of high octane. Currently, the refinery isprocessing about 12.5 million tonnes of crude per year and had a turnoverof US$ 8 billion during last year.

MRPL, which was a joint sector company, become a PSUsubsequent on acquisition of its majority shares by ONGC. As on 1 April2007, 71.62% shares are held by ONGC, 16.95% shares are held byHPCL and remaining shares are with public and financial institutions.MRPL has also been declared as Miniratna, a mini jewel, by Governmentof India in 2007.

Before acquisition by ONGC in March 2003, MRPL was a jointventure oil refinery promoted by M/s Hindustan Petroleum Corporation

Limited (HPCL), a public sector company and M/s IRIL & associates(AV Birla Group). MRPL was set up in 1988 with the initial processing

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capacity of 3.0 million metric tonnes per annum that was later expandedto the present capacity of 9.69 million metric tonnes per annum.

The refinery was conceived to maximise middle distillates, withcapability to process light to heavy and sour to sweet crudes with 24 to 46API gravity. On 28 March 2003, ONGC acquired the total shareholdingof A.V. Birla Group and further infused equity capital of Rs.600 croresthus making MRPL a majority-held subsidiary of ONGC. The lendersalso agreed to the debt restructuring package (DRP) proposed by ONGC,which included, inter alia, conversion up to Rs 365 core of their loansinto equity. Subsequently, ONGC has acquired equity allotted to thelenders pursuant to DRP raising ONGCs holding in MRPL to 71.62

percent.

PART -2 .

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OBJECTIVES, SCOPES, RESEARCHMETHODOLOGY, DATA ANALYSIS,

FINDINGS AND CONCLUSIONS.

2.1. OBJECTIVE OF THE STUDY.

THE OBJECTIVE OF THE STUDY FORINDUTRIES

ARE TO FIND OUT:

THE RELEVENCE OF LUBRICANTS USED INACCORDANCE WITH THE PRODUCT THAT IS BEING

MANUFACTURED IN RESPECTIVE INDUSTRY. CONSUMPTION OF LUBRICANTS IN INDUSTRIES BASED

ON PREFERENCES, PRIORITY AND INDIVIDUALITY. REQUIREMENT ON LUBRICANTS IN SPONGE IRON,

STEEL AND ANCIALLARY INDUSTRIES. CONSUMPTION OF LUBRICANTS ACCORDING TO THEIR

VISCOSITY GRADES.

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THE OBJECTIVE OF THE STUDY FOR

RETAIL(BAZAAR) MARKETARE TO FIND OUT:

THEBRANDSWHICH ARE BEING SOLD IN THE MARKETOF THE ABOVE MENTIONED DISTRICTS.

THE CATEGORY OF LUBRICANTIS HAVING WHICH ISHAVING MAXIMUM SALES.

THE AWARENESS OF MAKLUBRICANT AMONGRETAILERS AND CONSUMERS.

THEPARAMETERSON WHICH THE RETAILRES DECIDEFOR KEEPING A PARTICULAR BRAND OF LUBRICANTFOR SELLING.

THEMAXIMUM SELLING PACK SIZESSOLD IN BO TH THEDISTRICTS.

2.2. SCOPES AND LIMITATIONS OF THE STUDY.

SCOPES OF THE STUDY.

THE STUDY COVERS ALL THE SPONGE IRON,STEELAND ANCIALLARY INDUSTRIES AS WELL AS ALL THERETAILERS IN ANGUL AND DHANKANAL DISTRICT.

THIS STUDY COVERS THE OPPORTUNITY ANALYSISOF MAKLUBRICANT OF BHARAT PETROLEUM IN SPONGEIRON, STEEL AND ANCIALLARY INDUSTRIES AS WELL AS INRETAIL MARKET.

THE STUDY ALSO COVERS ANALYSIS OF INDUSTRIESREQUIREMENT AND CONSUMPTION OF LUBRICANTS IN

INDUSTRIES AS WELL AS AWARENESS, PERCEPTION AND

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CONSUMPTION OF LUBRICANTS BY COMMON END-USERSTHROUGH RETAILERS.

THE SURVEY HAS PROVIDED THE COMPANY WITH

MUCH NEW LUBRICANT RELATED INFORMATION OFINDUSTRIES AND OTHER BUSINESS CONTACTS WHO MIGHTBE POTENTIAL CUSTOMERS OF BHARAT PETROLEUMCORPORATION LIMITED.

THIS SURVEY ALSO PROVIDES AN INSIGHT ABOUTTHE PRIORITIZATION FACTORS OF THE INDUSTRIES ANDRETAILERS FOR COMSUMING AND SELLING DECISIONRESPECTIVELY.

FOR RETAIL MARKET THE SURVEY HAS ALSOPROVIDED THE COMPANY THE NUMBER OF DISTRIBUTORS INEVERY BLOCK AS WELL AS THE DEMAND OF THECUSTOMERS IN THOSE BLOCKS.

LIMITATIONS OF THE STUDY.

LACK OF INTEREST AND ENTHUSIASTIC RESPONSESMAY HAVE ALLOWED BIASES IN THIS REPORT IN THE FORMOF NON-RESPONSIVEERROR.

CORRECTNESS OF THIS REPORT IS RESTRICTED ANDLIMITE DBY THE DEGREE OF AUTHENTICITY OF DATACOLLECTED AND SINCERITY AND HONESTY OFRESPONDENTS.

AREA OF STUDY IS RESTRICTED TO ANGUL ANDDHENKANAL DISTRICT OF ORISSA ONLY WHICH IS A MAJORLIMITATION.THE NATIONAL SCENARIO MAY BE TOTALLY

DIFFERENT FROM THE RESULTS OF THE ABOVE MENTIONEDAREAS.

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2.3. RESEARCH METHODOLGY.

METHODOLOGY and APPROACH.

The study was qualitative in nature based on industrial andretailer consumption and stock keeping units decision respectively. Fieldresearch was carried out for the survey both for the case of industries andretailers. For industries the study wasDESCRIPTIVEin nature where as

for retailers it was EXPLORATORY.

DATA SOURCE Primary data source as new facts and figures arebeing collected from the project.

SAMPLING PLAN.

The main target area for the purpose of collecting the sample forthe study was ANGUL and DHENKANAL where the main target

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population wasSPONGE IRON STEEL & ANILLARY INDUSTRIESand RETAIL SHOPSselling lubricants to consumers and end-users.Finally PROBABLISTIC CLUSTERED sampling was done since every

industry and retailers had an equal chance of being selected.

RESEARCH INSTRUMENT.

Separate questionnaires were being prepared both for industryand retailers where each consisted OPEN-ENDED, CLOSE-ENDED,CHECKLISTS and STRAIGHT-FORWARD TYPE QUESTIONS. Themode of collecting the data was basically interview-administered andface to face conversations for both industry and retailers.

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2.4. DATA ANALYSIS.

2.4. A. INDUSRTY (BUSINESS TO BUSINESS)

The project perambulates round the requirements of

lubricants in sponge iron steel and ancillary industries. The main purposeof the study was to find out the requirements of various types of lubricantssuch as mainly HYDRAULIC OIL, GEAR OIL, GREASES, TURBINEOILS, TRANSFORMER OIL and other various types of oil. Through thisanalysis we were also able to find the priority of parameters which helpsin making an industrys decision of buying lubricants from a particularcompany, distributor or from any other source of supply. Other factorsthat we were being measured through this study were like that of

performance level monitoring, average monthly consumption of industriesfor lubricants. The sample for the study of the above mentioned

parameters were about 41 industries both from ANGUL andDHENKANAL.

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The following are the analyzed parameters which are knownto be significant for industries in terms of consumption, requirement:

MONTHLY CONSUMPTION OF INDUSTRIES.

The monthly consumption of lubricants varied from industry to industrydepending on the size of the industries i.e. large, medium and small scaleindustries. The following graph shows the consumption rate of industriescumulative of both the districts:

The following graph shows the district wise consumption of lubricants in respective

industries:

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MOST CONSUMED BRANDS IN INDUSTRIES.It is found that IOCLs lubricant brand SERVO has the high frequency ofconsumption when analysis is done on cumulative basis of both thedistricts. CASTROL comes second but this is only due to the fact that it is

being consumed only in small scale industries like stone crushers and thattoo in a very small quantity (the above graphs best gives therepresentation).Both BPCL and HPCL too have good proportion ofmarket share of lubricants in industries as per the frequency obtained fromthe analysis.

FREQUENCY OF MOST CONSUMED BRANDS IN BOTH THEDISTRICTS.

The results were the same when individual district wise frequencyanalysis was done. For Angul, IOCL still topped the market of industrieswith HPCL and BPCL coming to second and third position respectively.

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CONTD.........

In DHENKANAL, it is evident that CASTROL has a good portion of themarket share but it is due to the fact that most of its frequency is comingfrom that of in small scale industries like stone crushers. Here also IOCLhave the majority of the frequency.

PARAMETERS WHICH DECIDES TO BUY LUBRICANTS.

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From the research it was found that out of41 industries(bothsmall and large scale) 27buy their required portion of lubricants on the

basis ofPRICEfactor, similarly 23 does the same on SERVICEwhereas11 and 13 are forRECOMMENDATIONand OTHERSrespectively. The

parameter OTHER includes sub-parameters like that ofQUALITY,SATISFACTIONetc.

The given graphical representation gives the best over viewof the parameters on which all the industries in ANGUL andDHENKANAL decide their process of buying lubricants as for the

purposes of consumptions and requirements:

So, finally it can be concluding that most of the industries(irrespective of their size-large, medium, small scale) mainly put emphasis

on PRICE and SERVICE as their primary and RECOMMENDATIONand OTHER factors as their secondary priority. For district wise analysis of the parameters for buying lubricants, itwas found that most of the industries irrespective of their size mostly hadPRICE, SERVICE and OTHER (SATISFACTION, QUALITY) as their

primary priority and RECOMMENDATION as secondary priority. Thismentioned prioritizations of parameters were found for ANGUL district.The following graph gives the best view of the parameters that theindustries in ANGUL on an average takes for buying lubricants for the

purpose of consumption and requirements of lubricants in their respective

industries:

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PARAMETERS FOR INDUSTRIES IN ANGUL.

In case of industries in DHENKANAL district the scenario is a bitdifferent than that off ANGUL district. Here the industries have adifferent priority in case of buying lubricants for their industries.

PARAMETERS FOR INDUSTRIES IN DHENKANAL

From the above graph only it is quite clear that PRICE comesas first priority followed by SERVICE,RECOMMENDATION andOTHER as second ,third and last priority respectively for industries as forthe consumption of lubricants.

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On a total of the two districts it was found that on an averagemost of the industries get their portion of supplies from distributors,While the major half of the remaining portion get s from direct companies

and the remaining small portion from other sources irrespective ofdistributors and direct company.

The given graph best explains the process of sourcing lubricantsby the industries in both the districts:

Out off all the industries in both the district 33 gets their portion oflubricants from distributors whereas 12 and 2 gets from direct companyand other sources respectively.

On a district wise analysis of sourcing of lubricants on average,it

was more or less same for the industries in both the districts,dependingon the total number of industries in each district(DHENKANAL havemore industries as compared to that of ANGUL). The former graphexpalins the sourcing of lubricants by industries in ANGUL districtwhereas the later GRAPH shows that of DHENKANAL district:

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SOURCING OF LUBRICANTS BY INDUSTRIES IN ANGUL.

SOURCING OF LUBRICANTS BY INDUSTRIES IN DHANKANAL.

PERFORMANCE LEVEL MONITORING.

From the analysis of the performance level monitoring it was quite vividthat majority of the industries of both the districts never measures any

performance level of lubricants in their respective industries afterconsumption. It was clear that only 17 out of all the industries in both

districts measures the level of performance of lubricants, whereas as amajority of 22 never measures and only a mere 4 out of all measure

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performance at times. The under given graph gives the clear picture ofmeasurement of lubricants by all the industries in both the district:

CONTD..

PERFORMANCE LEVEL MONITORING.

But the scenario for the same was very significantly differentwhen analysis was being made on the district level. The industries inANGUL came out to be more aware of the monitoring performance levelof lubricants where as for DHENKANAL the result shows no process ofmonitoring performance level. Out of all the industries in ANGUL almost11 do monitor performance level of lubricants and 2 never does, whereasin DHENKANAL only 5 industries of the total do monitor but a majorityof 19 of the total does not monitor and only a mere 9 of the total monitor

performance level but that too at times and not on regular basis. Thefollowing graphical representation best gives the view of performance

level monitoring in both the districts separately.

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PERFORMANCE MONITORING OF INDUSTRIES IN ANGUL.

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PERFORMANCE LEVEL MONITORING BY INDUSTRIES INDHENKANAL.

The district wise requirement of lubricants for industries onan average is 11.47 kilolitres of lubricants in ANGUL; where as theaverage consumption of lubricants by industries in DHENKANAL was2.65 kilolitres. The difference between the average consumption oflubricants in the two districts is due to the fact that DHENKANAL hasmore number of medium and small scale industries as compared to thatof that of ANGUL.The consumption of lubricants such as hydraulic oil,turbine oil, axile oil, air lube transmission oil are also at much more levelin ANGUL as compared to that of industries in DHENKANAL.

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2.4. B.RETAIL MARKET (BAZAAR).

The project perambulates round the bazaar potentialassessment of lubricant for ANGUL and DHENKANL district. It was

being assigned to carry out a survey of all the retailers in the two districts;to begin with I have classified the ANGUL district into eightBLOCKS /TEHSIL and DHENKANAL into nineBLOCK/TEHSIL.There were 78 and 56 retailers in both ANGUL andDHENKANAL district respectively. The analysis is based on certain

parameters and the survey was carried out through questionnaire, (beingthe medium of exploration).

The total quantity of lubricant sold in ANGUL district is62580 litres whereas the total for the same was 44725 litres inDHENKANAL district. This further counts for an average of813 litres of lubricants products for retailers in ANGUL whereasthe average sales of retailers in DHENAKANL are about 799litres.

HIGEST SELLING BRANDS.

FOR BOTH THE DISTRICTS.

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The analysis clearly shows that CASTROL is the highest sellingbrand in all the markets of the two districts. Similarly SERVO comessecond followed by HPCL as third and VEEDOL as fourth.PENSOL toohave a good portion market potential despite being a local brand.Variousother local brands also have a good market composition.

On comparing the figures districtwise also the results were sameas above.The folloowing are the graphs of retailers for both ANGUL nadDHANKANAL district:

FOR ANGUL DISTRICT.

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FOR DHENKANAL DISTRICT.

MAXIMUM SELLING CATEGORY.

The graph under given, gives a brief idea about the maximum sellinglubricant category in both the districts:

The above graph clearly demonstrates that 2-wheeler lubricantproducts are the maximum selling product category for lubricants in boththe districts.Out off all the retailers in both the district it is clear that 81 ofthe total are maximum selling 2-wh lubricant produtcs.2-wh lubricant

products are then followed by diesel products counting to 64,which is dueto the fact that both ANGUL nad DHENAKANL are industrial areas witha huge amount of heavy vehicles movement.Then comes the category of4-wheelers amounting to 59 out of all the retailers.This scenario is samefor both the districts when analysis is being made on district wise,wherefor ANGUL 40,39,37,1,1 are for 2-wh,diesel,4-wh,coolant and greaserespectively and 38,22,19,0,0 for 2-wh,diesel,4-wh,coolant,greaserespectively in DHENKANAL .

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The following graphs give the vivid picture of themaximum selling product of lubricants in both the districts when analysisis being made district wise:

MAXIMUM SELLING PRODUCT CATEGORY IN ANGUL.

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MAXIMUM SELLING PRODUCT CATEGORY FOR DHENKANAL.

MAXIMUM SELLING PACK SIZES.

Here we are having different category of pack sizes they are 0-1 litre, 1-5litre, 7-20 litre, Barrels.

MAXIMUM SELLING PACK SIZES FOR BOTH THE DISTRICT.

By doing this analysis we can conclude that the highest sellingpack size of lubricant in both the districts is 7-20 litres, whereas under 1

litre pack is second and 1-5 litre pack is third in maximum selling packsizes.

While doing the analysis on district level, the results are quitedifferent. For ANGUL 7-20 litre pack are still the majority selling packsizes whereas uder 1 litre and 1-5 litre packs are coming together insecond position and finally barrel with nominal sales. In case ofDHENAKANL district packs of under-1 litre is maximum selling and 1-5litres and 7-20 litres are second and third higest selling categoryrespectively with 42 and 20 points.

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The following graphs are for maximum selling pack sizes for both thedistricts individually:

MAXIMUM SELLING PACK SIZES FOR ANGUL.

MAXIMUM SELLING PACK SIZES FOR DHENAKANL.

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PARAMETERS FOR SELECTING A BRAND FOR SELLING.

Here we are having several parameters that are preferred by theretailers while they keep the brand in their counters. The parameters arePrice or MRP of the product, Profitability or Margin that is given by thecompany to the retailers, Market demand of the product, Payment term ofthe company to the retailers, Scheme or incentives that are given to theretailers for selling their brands and at the last but not the least quality ofthe product.

PARAMETERS FOR SELECTING A BRAND FOR SELLING .

From the above diagram only is clear that demand is the mostimportant parameter which decides for a reatiler to keep a brand for the

purpose of selling to their customer.After demand its margin that comessecond and wuality as third parameter for the retailers.The scenario issame for the two districts when analysis is being done on individualdistrict level.

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The following are the graph represents the individual districtwise parameter selection of brands for retailers:

ANGUL

DHENKANAL.

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MAK AWARENESS.

MAK AWARENESS IN BOTH THE DISTRICTS.

Out of 138 retailers as respondent 132 is well aware of

MAK brand. So this figure is quite significant which represents theawareness of MAK brand amongst the market of the two districts. Thefigures are quite same when analysis is done on district level.

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ANGUL

DHENAKANAL.

Hence it is quite clear that the awareness of MAKamongst the retailers in both the district is quite high.

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BLOCKWISE REPORT ON BAZAAR MARKET.

For assessing the market of lubricants in ANGUL andDHENKANAL, each district was divided in further blocks andtehesils.For ANGUL the district was divided into 8 blocks whereasDHENKANAL was divided into 9 blocks.

ANGUL.

Angul was divided into 8 blocks namely asKANIHA,TALCHER,ANGUL,BANARPAL,ATHMALLIK,CHENDIPADA,KISHORENAGAR,PALALAHADA.Block wise each analysis isdone where a good market potential is being found. Respective blockwise details are :

FOR TALCHER .

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MAXIMUM SELLING PRODUCT TYPE.

MOST SOLD PACK SIZES.

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BRANDS OF LUBRICANTS MOST SOLD BY THE RETAILERS.

From the above graphs it is quite clear that since Talcher being one ofthe busy industrial zones, lubes products of diesel vehicles are being mostsold which is resulting the sale of 7-20 litres the mostly sold pack sizes.

For retailers, the important parameter for choosing a brand for selling.Here CASTROL still remains the highest selling brand among the retailmarket.

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FOR KANIHA.

The scenario is different for Kaniha market where in thesales of 2-wheel lubes product are the maximum resulting to 1 litre packs

the most selling. But the parameter for selecting a brand for selling by theretailers still remains as demand. Castrol is still the market leader.

CONTD......

MAX SELLING PRODUCT CATEGORY.

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LUBRICANT BRANDS MOST SOLD BY THE RETAILERS.

P.T.O

FOR CHENDIPADA.

For CHENDIPADA also the results are the same as that of the results ofKANIHA market. Following are the interpretations:

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FOR BANARPAL.

For Banarpal, the scenario is same as that of Angul where dieselvehicle products are the maximum selling lube products resulting the saleof 7-20 litre pack sizes, but in this market SERVO is the market leader in

lubes.


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FOR ANGUL BLOCK.

Angul block is the most interesting block where both 2-wh and dieselvehicle products are the maximum selling lubes products and resulting tothe sales of 1-5 litres as the most sold. In this market both CASTROL andSERVO are the market leaders.

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For other markets like that of KISHORENAGAR and PALALAHADAare too small to perform the above analysis. The market potential are alsotoo low here.

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DHANKANAL

For DHENKAANL to the district was divided into 9 blocksnamely as HINDOL, ODAPADA, SADAR, DHENKANAL,

KAMAKHYANAGAR, BHUBAN, PARAJANG, KANKADAHAD andGANDIA.

FOR DHENKANAL.

In DHENKANAL also diesel vehicle lubes product are the mostselling resulting further in the maximum sales of 1-5 litre pack sizes.Demand remains the main parameter for selecting a brand by the retailers

for selling. Both SERVO and CASTROL are the MAXIMUM SOLDBRANDS. The under given graphs best shows the analysis:


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FOR KAMAKHYANAGAR.In the market of kamkhyanagar, it is found that 2-wheel lubes product aremaximum selling which results in the maximum sales of 1 litre packs.Castrol is the mostly sold brand among the shops in kamakhyanagar.


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FOR SADAR.

For SADAR market too the highest selling lubes product type is 2-wheel but the maximum sold pack sizes are that of 7-20 litres.Demand still

remains the major priority for retailers in selecting a brand for sales.Servois the market leader in this area.


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FOR HINDOL.

In HINDOL market also 2 wheel lubes products are being maximumsold resulting to the maximum sales of 1-5 litres pack.But here theimportant parameter for selecting a brand by the retailers is Margin which

has changed from demand as compared to that of other markets.Servo isthe leading player in this market.

MAX SELLING PRODUCT CATEGORY

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For other markets namely asBHUBAN,PARAJANG,ODAPADA,KANKADAHAD and GANDIAare very small markets where the market potential is also too low.

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2.5.FINDINGS .

FINDINGS FROM INDUSTRIES .

For industries, the requirements of lubricants basically varied as per the nature of the products that are being manufactured which istypically high for large scale industries like BHUSHAN STEEL &POWER PVT.LTD, NAVA BHARAT VENTURES LTD etc.Similarlythe rate consumption is low for medium and small scale industries. Fromthe analysis it was quite clear that irrespective of the size of industries,PRICE always remained the major parameter which helps them for the

purpose of buying lubricants. The same was found out when individualanalysis was done on each district. It is also found from the analysis of

both the districts in cumulative as well as individual form that a majoritynumber of industries are sourcing their lubricant requirements fromdistributors rather than directly from company of the brand they areconsuming. From the survey it can be concluded that the averageconsumption of lubricants in ANGUL district is nearly about 11470 litreswhereas the consumption for industries in DHENKANAL is 2065 litreswhich is quite low when compared to that of ANGUL.

FINDINGS FROM RETAIL (BAZAAR) MARKET.

From the analysis it was found that CASTROL is the market leaderin of lubricants in bazaar market. Similarly SERVO comes second andthereafterHPCL, VEEDOL, PENSOL are ranked respectively as third,fourth and fifth respectively. The scenario was same when individualdistrict wise analysis was done on ANGUL but only the fifth position was

being taken by VALVOLINEin DHENKANAL district.In retail market, for both the districts taken together as well as on

individual level, the total sale of 2 wheeler lubricant products are quitedominant, after which diesel products have the second majority. This isdue to the fact that both ANGUL and DHENKANAL are industrial areaand hence sale of four wheel lubes product are coming third.

DEMAND has been one of the major parameter for retailers forwhich they keep stocks of a particular brand of lubricant for selling it tothe market. Hence it can be inter linked that CASTROL has the maximumdemand as it is the highest selling brand in both the districts individually.After demand, MARGIN is the second most important parameter for

retailers for keeping a brand. This is so because it is quite natural thatmargin is the parameter that gives profit to the retailers.

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ANNEXURE.

QUESTIONNAIRE FOR INDUSTRY SURVEY.

Survey to understand Customers Needs in the context of Purchase ofLubricants:

Name of the Customer:

Address and contact

Nos.....

Persons Met: 1. Name

Designation..2. NameDesignation.

3. NameDesigna

Documents

Final Copy of Summer Internship @Bharat Petroleum Corp.ltd