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Bank Presentation - February 2016

US$465 Million Syndicated Term Loan Facility

(A Fortune Global 500 Company)

Hindustan Petroleum Corporation Limited

§ Takeover and merger of ESSO
and Lube India into HPCL

§ Merger of Caltex with HPCL

§ Merger of Kosan Gas with HPCL

1974

1978

1979

2

§ StanVac operations taken over
by ESSO

§ Incorporation of Caltex Oil
Refining

1955

1962

§ Incorporation of Standard –
Vacuum Refining Company
(StanVac)

1952

Questions
Our
History

133

Rank :

3

327

Rank :

Questions
Global
Rankings

4

Vision Co-created by all employees

The Company will be a model of Excellence in meeting
Social commitment, Environment, Health & Safety and
in employee welfare & relations”

“To be a World Class Energy Company known for
caring and delighting customers with high quality
products and innovative services across domestic &
international markets with aggressive growth and
delivering superior financial performance.

Questions
Our
Vision

As of 31.12.2015

Financial
Institutions,
4.14%

Foreign
Institutional
Investors /
Overseas
Commercial
Bodies, 19.40%

Banks, 0.05%

Mutual Funds,
10.67%

NRIs, 0.29%

§

No. of shares : 338.6 Million

§
Public, 14.27%

§

Shareholders : 99,280

§

5

Employees,
0.07%
Government of
India, 51.11%

Market Capitalization : US$4,279 Million

Share Capital : US$51.18 Million

QuestionsProfile
Shareholders’

#

14.8 MMTPA

Refining

$Note:

31.6 MMTPA

*

Natural Gas

Operations & Distribution

Aviation

Direct Sales

• 8 Cross country
pipelines of total length
of 3,015 km$

Pipelines

32.0 MMT

Marketing

Retail
LPG

New 443 km long Rewari-Kanpur Pipeline commissioned in Oct’2015
6

• Refining, Marketing Infrastructure,
Biofuels and Emulsions

2014-15
Currently Active blocks

* in

JVs &
Subsidiaries
Partnerships in

• Operating thru M/s
Prize Petroleum, a
wholly owned
subsidiary

6 Blocks#

E&P

• Visakh: Fuels (8.3 MMTPA) Refinery

• Mumbai: Fuels (6.5 MMTPA) & Lubes (428 TMTPA) Refinery

Questions
Business
Portfolio

2.3%

MMT

4.3%

Crude Thruput

MMT

Domestic Sales

9

Highest PAT : US$437 Million

India’s No.1 Lube Marketer : 478 TMT

Pipeline Thruput : 14.91 MMT

Mkt. Growth : 2.3% Vs Ind.(PSU) 2.2%

Market Sales : 31.95 MMT

CorporateQuestions
Highlights: 2014-15

57.6%

US$
Mn
6.7%

Net Worth

US$
Mn

Profit after Tax

1.29
7.57
0.39

1.03
8.09
0.17

US$
US$
US$

EPS

Book Value Per
Share

Dividend Per Share

Total Debt Equity
Ratio

10

1.1:1

437

349

US$
Mn

Profit After Tax

1.27:1

34,727

22,585

US$
Mn

Gross Sales

2014-15

Apr –
Dec 15

Description

Unit

Questions
Financial
Performance

2.14:1

0.25

7.09

0.82

277

37,161

2013-14

Refining

Questions

8.3
14.8

Visakh

Total

Mangalore
Refinery

Mumbai
Refinery

12

16.95% Stake in 15 MMTPA MRPL Refinery

49% Stake in 9 MMTPA HMEL Refinery at Bathinda

Lube Refinery (Mumbai) 428 TMTPA

6.5

Capacity
(MMTPA)

Mumbai

Refinery

Bathinda
Refinery

Questions
Refining
Network

Visakh
Refinery

13

RefiningQuestions
Performance

14

– Combined Distillate yield 77.5%
– Production of transportation fuels
MS : 2.7 MMT
HSD : 6.1 MMT

Highest ever

Questions
Refining Highlights
2014-15

(Phase-I)

• Project Cost : US$672 Million

• From 6.5 MMT to 10 MMT

Mumbai Refinery

15

• Project Cost : US$2,720 Million

• From 8.3 MMT to 15 MMT

Visakh Refinery

Questions
Refinery
Expansion

Collaborative
Research

Support to
Refining/
Marketing
Functions

Focus
areas

Infrastructure
Development

14

36
6

Lubricants

Applied

2

-

Obtained

• Alternative Energies

• Catalyst Development

Developments

• New Process

• Residue Up-gradation

• Opportunity Crudes

R&D Thrust Areas

Research Areas

Patents

Product /
process
Development

Green R&D Centre being setup in
Bengaluru with 9 labs

Questions
Research and
Development

15

Reduction in Process Plant Footprint

Lower capital costs.

•

Benefits:

§

Reduction in footprint / smaller
equipment - Size reduction by 10
times

Processed feed gas with 4 to 5
wt% of H2S and achieved less
than 100 ppm

§

•

Commissioned HP-HiGAS
Technology based commercial
unit at Visakh Refinery

§

HP-HiGAS Technology

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HP-HiGAS Unit
at Visakh Refinery

• Technology Indigenization

• Production of high value
Hydrogen from low value
Refinery off Gases

§ Benefits:

§ Hydrogen purity > 99.5%

§ Commissioned Hydrogen
Pressure Swing Adsorption
Technology for purification of
CCR Off Gas at VR

Hydrogen Pressure Swing
Adsorption Technology

16

Questions
H2 PSA
Technology

Marketing

Questions

20

Questions
Marketing
Performance

4.1 MMTPA
45 Nos.

LPG bottling capacity

QC Labs

*As of 31.12.2015

21

3.1 MMT

POL Tankage

TOP = Tap off Point ; POL = Petroleum Oil & Lubes

As of 31.12.2015

91

46

LPG Plants

Description

36

Terminals / TOPs POL/Lube Depots

36

ASFs

7

Lube Blending
Plants

Questionsinfrastructure
Marketing supply

4.0 MMT
0.5 MMT
0.5 MMT
4.7 MMT

Industrial and Consumer (I&C)

Lubes

Aviation

LPG

13%

1.5%

15%

1.5%

20

Retail constitutes 69% of HPCL product sales

*Exports = 850 TMT

69%

Aviation

LPG

Lubes

I&C

Retail

Total marketing sales = 31.95 MMT (including exports*)

21.4 MMT

Retail

HPCL Marketing business lines

Volumes Split by Business Line ( 2014-15)

MarketingQuestions
Sales : 2014-15

25.4%

(PSU)

Market
Share*

e-fuel stations

21

Non-fuel &
Conveniences

outlets 2,300+

Network of Automated retail

total to 1,600+

during 2014-15, taking the

Commissioned 100+ ATMs

Outlets during 2014-15

Commissioned 380 Retail

11th consecutive Year.

Market share gain in TMF for

Strong Customer Loyalty

Formats

Sales
21.4 MMT

* Market Share indicated for Retail SBU
Overall Market share for HPCL = 21.0% (PSU Category)

Segmentation

Network
13233
Outlets

Retail
Questions

“Retail Outlet Formats”
designed to address needs of
“Prominent Customer Segments”
in ‘Standardized’ manner.

Segmentation based on
‘Stated’ and Latent Needs’
of customers.

24

Rural

Highway

Urban

Customer Questions
Centric Formats

Ø Strong product brands

Ø 478 TMT – Total Lube Sales

25

Ø Largest Base Oil Refinery (450 TMTPA) in
India, Group II/III 230 TMTPA

Ø 250+ Grades of Lubricants

Ø India’s No.1 Lube Marketer

Questions
Lubricants

• 2 Mother Warehouses
• 189 Stock Points
• Last Mile Connectivity

Pan India Logistics Coverage

• Vashi, Mumbai

• Expansion plans

• ISO 9001, 14001
Silvassa

24

• Seven ISO 9001 certified blending plants: 325 TMTPA
• State-of-the-Art 65 TMTPA blending plant at Silvassa

Lube Blending

Questions
Lubricants

Daruhera

LPG

: 4.7 MMT

27

World’s Largest Carousel - 72 Head Flex
Speed commissioned at Yediyur Bangalore

No. of LPG Distributorships – 3,952

Market Leader in Non-Domestic Bulk LPG
Segment with 51% market share

Market share : 26.8%

LPG Sales

Questions

Data : March 31, 2015

airlines

Only Jet Fuel Supplier to all domestic

•

Market share gain in major products –

•

28

Marine Bunker Sales growth of 17%

HSD, FO, LSHS & Bitumen

Sales Volume 3.98 MMT, Growth 2.8%

•

Industrial & Consumer Segment

•

Growth in Volume 13.5% against

•

Ind.(PSU) growth of 0.2%

Sales volume of 506 TMT

•

HP Aviation

Questions
Direct business
lines

3

Awa – Salawas, Raj
93 Kms; 2.34 MMTPA

1

PUNE

MIRAJ

Petronet Mangalore- Hassan
– Bangalore P/L
364 Kms ; 3.1 MMTPA

MANGALORE

Mumbai – Pune – Solapur
508 Kms ; 4.3 MMTPA

Mumbai Refinery

PALANPUR

AJMER

BAHADURGARH

Bathinda Refinery

Mundra – Delhi P/L
1054 Kms; 5.0 MMTPA MUNDRA

5

JV Pipeline

6

27

BANGALORE

VIJAYAWADA

Vizag – Vijaywada – Secundrabad P/L
572 Kms ; 5.38 MMTPA

* Excluding MHB JVC P/L and specialty pipelines

POL pipeline network : 3, 015 kms*
Pipeline capacity
: 31.60 MMTPA*

2

Visakh Refinery

Rewari – Bharatpur - Mathura – Kanpur
443 Kms , 7.98 MMTPA

Kanpur

Ramanmandi – Bahadurgarh P/L
243 Kms; 4.7 MMTPA

SECUN’BAD

SOLAPUR

DELHI

4

Note:
Following 2 operational P/ls are not shown in map
1. Bathinda – Ramanmandi P/L
(30 Kms; 1.13 MMTPA)
2. Bahadurgarh - Tikrikalan P/L
(14 Kms – 2 spurs; 0.75 MMTPA)

Questions network in India
2nd largest POL Pipelines

30

PipelineQuestions
Performance

(397 Kms, 1.3 MMTPA)

Capex : ~ US$208 Million

31

Solur Mangalore –Hassan- Mysore –Solur

Uran – Chakan
Mangalore
Mumbai – Uran (sub sea)
Bengaluru
(165 Kms, 1.0 MMTPA)

Mumbai

Questions
LPG Pipeline Projects
under construction

Renewable Energy of 546 lakh
KwH was generated through
Wind Power Plants (at
Jaisalmer, Rajasthan and
Dhule, Maharashtra) for the
year 2014-15.

Total Revenue during 2014-15
US$3.55 Million

•

•

•

Additional 50 MW capacity
WEGs Planned in next Phase.

Planned Addition

Capacity : 50.5 MW.

•

Existing Capacity

30

Questions
Wind
Power

1

HRRL

Strategic Storage

Marketing

Refining

Questions
Subsidiaries
and JVs

GITL

GIGL

Aavantika Gas Ltd.

City Gas Distribution

Natural Gas

MAFFFL

Infrastructure

31

Introduction of new technology and value growth through Partnerships

CREDA HPCL Biofuels Ltd

74%

100%

Alternate Fuels

100%

Upstream

Subsidiaries

Note : Apr-Dec’15 Production : 48 TMT

32

2014-15 Crude / Gas condensate Production : 48 TMT

1- Producing Field (Sanganpur)
1- Discovered Field (Cambay)
1- Service contract (Hirapur)
1- Exploration Blocks (NELP IX)

Domestic Operations

1 - Producing Field
1 - Discovered Field

Overseas Operations (Australia)

Prize Petroleum, a wholly owned subsidiary

Questions
Exploration
& production

33

Andaman
& Nicobar
islands

1. Mallavaram – Bhilwara
Main line : 1,585 kms, Spur line 103 kms
Capacity: 39.7 mmscmd

Proposed Equity
US$72 Million

Pipeline Bid won in consortium

HPCL share ~11.6 mmscmd i.e. ~3.0 MMTPA)

GIGL : GSPL India Gas Net Limited
GITL : GSPL India Transco Limited

Being implemented
through JVCs : GIGL*
and GITL*.

2. Mehsana – Bhatinda
Main line : 990 kms, Spur line 770 kms
Capacity: 39.5 mmscmd

3. Bathinda – Jammu -Srinagar
Main line : 300 kms
Capacity: 25.7 mmscmd

NOT TO SCALE

Equity in Natural Gas Pipelines

Questions

34

Financial Closure for the project has been completed

HPCL Share in the Equity is
US$130 Million

Estimated Cost: US$864 Million

•

§

Capacity : 5 MMTPA

terminal at Chhara Port

5 MMTPA LNG Regasification

HSEL. HPCL Equity : 50%

Being implemented thru JVC –

•

•

•

Questions
LNG Terminal
at Charra, Gujarat

Vision 2030

35

Central Procurement

Integrated Margin Management

Questions
Strategic
Initiatives

Value creation levers

• Optimisation
of Crude &
Long-term
contracts

Feed Stock
Supply

Crude & Shipping

• Optimization
of distribution
costs & higher
infrastructure
utilisation

• Production
optimisation

36

IMM

Distribution

Supplies & Distribution

Refining

Refineries

• Inventory
Optimization

Storage

Operation

• Optimization
of Make or
Buy decisions

Sales

Marketing

Questions
Levers for value creation
across supply chain

37

• Effective Vendor Management

• Standardization of Processes

• Economy of Scale

Central Procurement cell:

Questions
Centralized
Procurement

Marketing

Human Resources

Human Resources

Projects

Projects

E&P

38

Research &

Gas

Research
& Development
Development

Finance

Finance

Refining

Emerging industry landscape and
HPCL Strategic direction

Questions
Vision
2030

CSR

CSR

Information Technology

Petchem

Information Technology

Alternate
Energy

Aggressively pursue growth opportunities in the gas business

Acquire upstream assets in domestic and international markets

Expand to build Petrochemicals business

Participate in the next wave of growth – solar / wind / others

2

3

4

5

39

Strengthen the core of Refining & Marketing

1

Questions
Our strategy
for the future

Thank you

Questions