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Case Study on

Indian Oil CorporationInternational Marketing Management

Group - 3

Bhanu Dora- 17

Bharat Bhushan Narang - 18

Geeta Cheema- 23

Kumar Pranav - 34

Rajesh Kumar Tiwary - 53

Soniya Rakesh Agnihotri- 72

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Indian Oil Corporation Ranked 83rd in the Fortune 'Global 500' listing, in 2012

Business Verticals

Refining

Pipeline Transportation

Marketing of petroleum products

Exploration & Production of crude oil & gas

Marketing of natural gas and petrochemicals

Shale Gas.

34,000+ strong workforce as on 31.03.2012

Sales turnover of $ 85000 million and profits of $ 825 million in 2012

Source of Data

Indian Oil Website

Annual Report 2011-12

Newspaper articles

Wikipedia

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Overseas Presence

Fully Owned Subsidiaries

Indian Oil (Mauritius) Ltd. into Terminalling, Retailing & Aviation

refueling

Lanka IOC PLC. into Retailing, Terminalling & Bunkering

IOC Middle East FZE Lube into blending & Marketing of Lubricants

IOC Sweden AB , an Investment company for E&P Project in

Venezuela

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Overseas Presence

Overseas portfolio

Two blocks (86 and 102/4) in Sirte Basin and Areas 95/96 in

Ghadames basin of Libya,

Farsi Exploration Block in Iran,

onshore farm-in arrangements in one block in Gabon,

one on land block in Nigeria,

one deepwater offshore block in Timor-Leste

Two onshore blocks in Yemen

Scouting for new business opportunities in Asia and Africa.

Actively looking for Globalization of its downstream operations

Incorporated Ind-OIL Overseas Ltd. a SPV for acquisition of overseas

E&P assets in partnership with Oil India Ltd.

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Identify main reasons behind IOC expansions into global

markets

Strategic move for globalization

Economy of scale

Production capacity

Potential customers and demand globally hence market size

Capitalization on global recognition at 83rd in world. To identify new source of oil and gas

Established R&D Center for new products

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IOC adopted mix of entry, factors affecting IOC selection of

these entry mode

External factors

Market Size Demand for oil and gas across the Aferica and Asia

Market growth IOC expected huge growth

Govt. Regulation Been govt. owned company targeting market likeAfrica and Asia was the soft target for expansion.

Level of risk Reduced risk with export, JV and turn key projects

Political Economical

Operational

Internal factors

Company objectives mission and vision statement

Availability of company resources -

Flexibility

International experience first mover experience and hencecapitalization

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Entry Marketing Mix

Country Entry Marketing Mix

Sri Lanka Wholly Owned SubsidiaryDirect Export

Mauritius Wholly Owned Subsidiary

Turn Key Operations

Strategic Alliance

Joint Venture

UAE Wholly Owned Subsidiary

Sweden Wholly Owned Subsidiary

Venezuela Consortium

Nigeria Joint Venture

USA Wholly Owned Subsidiary

Joint Venture

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Entering Sri Lanka

Direct Export First move in Globalization

Long term commitment for export in other countries as

well

Wholly Owned Subsidiary Lanka IOC PLC (LIOC)

75% stake

Economical and political factors

Mixed risks & gain strategy

First Strategic Move

Next level Growth

High degree to administrative Control

Turnover INR 2556.86 Cr with profit of 38.33 Cr in 2011-12

Investment in Ceylon Petroleum Storage Terminal Limitedworth INR 176.03

In view of emerging economic and political scenarios, evaluate

IOCs entry into Sri Lanka and other countries

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Mauritius Entering Strategy

WOS - Indian Oil (Mauritius) Ltd. - 100% stake

Economical and political factors Strategic step to serve as the supply base of petroleum products

Increase market share and profit

Turnover INR 1192.34 Cr with profit of 36.87 Cr in 2011-12

Turn Key Operations

Showcase their capabilities

Done through WOS Indian Oil tanking ltd.

Strategic Alliance

Internal strategic company mission and vision

Joint Venture

JV with Caltex

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UAE Entering Mode

Wholly Owned Subsidiary - IOC Middle East FZE 100% stake

Economical and political factors

Strategic investment to boost its business in future in other

Middle east countries Turnover INR 95.43 Cr with profit of 3.91 Cr in 2011-12

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Sweden Entering Mode

Wholly Owned Subsidiary IOC Sweden AB 100%

Strategic investment to promote and facilitate overseas

E&P investments.

Venezuela - Restrictions on foreign ownership and Risky

Country. With a consortium of five other companies, ICO

Sweden AB has holds a 3.5 per cent. stake in CaraboboHeavy Oil project.

The Carabobo Project is expected to produce and upgrade

3 billion barrels over the project life of 25 years.

Turnover NIL with profit of 17.01 Cr in 2011-12

Investment in Indoil Netherlands B.V worth INR 191.52 Cr

Total Asset INR 388.88 crore

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Entering Mode USA

Wholly Owned Subsidiary IOCL (USA) Inc 100%

The subsidiary was opened in 2012 to invest in shale gas

projects in USA.

At present, IOCL USA Inc. has acquired 10% ofCarrizo's interest in approximately 60,000 net acresand OIL will buy remaining 20 per cent

Huge reserves- Daily production of 1,850 barrels ofoil equivalent

Joint Venture Indo Cat Pvt Ltd with Intercat USA for

manufacturing 15000 tones per annum of FCC catalysts and

additives.

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Entering Mode Nigeria

Joint Venture With Suntera Nigeria 205 Ltd 50% Shares

To avoid Country Risk

To gain domestic knowledge through partner firm

Suntera owns Oil Prospecting License 205 for 20 years.