Dissertation Project Report

(Project Semester Jan-June 2021)

“Comparative analysis of Indian Oil Corporation Limited and Bharat Petroleum Corporation
Limited”

Submitted by
Anshul Nagori
Student ID: 18BBAN050

Under the Guidance of

Faculty Dissertation Guide: Mrs. Jyoti Jain

Designation: Assistant Professor

Faculty of Management

JECRC UNIVERSITY, JAIPUR

January, 2020 to June, 2020

I
 Declaration

I hereby declare that the project work entitled “Comparative analysis of Indian Oil Corporation Limited
and Bharat Petroleum Corporation Limited” is an authentic record of my own work carried out at
“Jaipur” as requirements for the award of degree of B.B.A., JECRC University, under the guidance of “Mrs.
Jyoti Jain”, during January to June, 2021.

Name of Student: Anshul Nagori

Student ID: 18BBAN050

Date: 17 April 2021

Certified that the above statement made by the student is correct to the best of our knowledge

Name & Designation

Faculty Dissertation Guide: Mrs. Jyoti Jain (Assistant Professor)

II
 Acknowledgements

At the outset, I take this opportunity to thank my FIG Mrs. Jyoti Jain, from the bottom of my heart

who have been of immense help during moments of anxiety and torpidity while the project was taking its

crucial shape.

Secondly, I convey my deepest regards to the School of Management to provide me such an

opportunity as part of my curriculum, this whole report making process has helped me gain a lot of

knowledge.

Thirdly, the contribution made by my sister and friends by foregoing their precious time is

unforgettable and highly solicited. Their valuable advice and timely supervision paved the way for the

successful completion of this project.

Finally, I thank the Almighty who gave me the courage and stamina to confront all hurdles during the

making of this project. Words are not sufficient to acknowledge the tremendous contributions of various

people involved in this project, as I know ‘Words are Poor Comforters’. I once again wholeheartedly and

earnestly thank all the people who were involved directly or indirectly during this project making which

helped me to come out with flying colour.

III
 Table of Contents

Sr. Particulars Page

No. no.
1 Introduction 1
1.1 Indian Oil Corporation Limited 2-7
1.2 Bharat Petroleum Corporation Limited 8-14
2 Oil and Gas Industry in India 15
2.1 Introduction 16
2.2 Diesel and petrol 16
2.3 Gases 17
3 Research Methodology 18
3.1 Introduction 19
3.2 Research objective 19
3.3 Methodological approach 19
3.4 Data collection 19
3.5 Analysis of data 19
3.6 Scope of the research 19
4 Review of Literature 20-22

5 Comparison between Indian oil corporation limited And Bharat Petroleum 23

corporation limited
5.1 Equity share data 24-26
5.2 Income data 27-28
5.3 Balance sheet data 29-31
5.4 Cash flows 32-33
5.5 Shareholdings 34
6 Conclusion 35-36

7 References 37

IV
 List of Tables

Sr. Particulars Pages

No.
Table 5.1 Equity share data 24-25

Table 5.2 Income data 27

Table 5.3 Balance sheet data 29-30

Table 5.4 Cash flows 32

Table 5.5 Shareholdings 34

V
 LIST OF FIGURES

Sr. Particulars Pages

No.
Figure Book Value per share comparison graph 25
5.1
Figure Earnings per share comparison graph 26
5.2
Figure Net sales comparison graph 28
5.3
Figure Gross profit comparison graph 28
5.4
Figure Total assets comparison graph 30
5.5
Figure Debt to equity ratio comparison graph 31
5.6
Figure Cash flow from operation comparison graph 32
5.7
Figure Cash flow from investment comparison graph 33
5.8
Figure Net cash flow comparison graph 33
5.9

VI
 ABSTRACT

Indian market is considered as one among the largest consumer market in the world with a population of
1.3 billion. As fuel is current major necessity because world is not fully powered by electricity as an
alternative fuel source. Hence, Indian oil and petroleum industry is a vast and diversified wholesome
industry. In this work I am going to have a brief idea of Indian oil and petroleum industry and the major
players of this industry. Further we are also going to distinguish between two major players of oil and
petroleum industry i.e. Indian Oil Corporation Limited and Bharat Petroleum Corporation Limited. And we
are going to have a broad idea about these two companies on factors like income data, equity shares,
balance sheet, shareholdings, cash flows of both the companies.

VII
VIII
 Chapter – 1
INTRODUCTION

1
Indian Oil Corporation Limited-

Indian Oil Corporation Limited (IOCL), commonly known as Indian Oil is an Indian government
owned oil and gas company headquartered in New Delhi. It is the largest commercial oil company in the
country, with a net profit of INR 19,106 crore (US$2.848 billion) for the financial year 2016–17. It is
ranked 1st in Fortune India 500 list for year 2016 and 117th in Fortune Global 500 list of world's largest
companies in the year 2019. As of 31 March 2017 Indian Oil's employee strength is 33,135, out of which
16,545 are in the officer cadre. It is India's largest downstream oil company, with a workforce of more than
33,000 employees, a turnover of Rs. 506,428 crore and a net profit of Rs. 21,346 crores in 2017–18.

Indian Oil's business interests overlap the entire hydrocarbon value-chain, including refining, pipeline
transportation, marketing of petroleum products, exploration and production of crude oil, natural
gas and petrochemicals.

Indian Oil has ventured into alternative energy and globalisation of downstream operations. It has
subsidiaries in Sri Lanka (Lanka IOC), Mauritius (Indian Oil (Mauritius) Ltd) and the Middle East (IOC
Middle East FZE).

In May 2018, IOCL become India's most profitable state-owned company for the second consecutive year,
with a record profit of ₹21,346 crore in 2017–18, followed by Oil and Natural Gas Corporation, whose
profit stood at ₹19,945 crore. In February 2020, the company signed a deal with the Russian oil company
Rosneft to buy 40,000 barrels per day of crude in year 2020. From April 1, 2020, The Indian Oil is in
absolute readiness to launch BS-VI (Bharat Stage VI) fuels in all its retail outlets in Telangana and
adopt world-class emission norms.

Operations-

Business Divisions

There are 7 major Business Divisions in the organisation:

• Refineries Division
• Pipelines Division
• Marketing Division
• R&D Division
• Petrochemicals Division
• Exploration & Production (E&P) Division
• Explosives and Cryogenics Division
2
Products and services

Indian Oil accounts for nearly half of India's petroleum products market share, 35% national refining
capacity (together with its subsidiary Chennai Petroleum Corporation Ltd., or CPCL), and 71%
downstream sector pipelines through capacity. The Indian Oil Group owns and operates 11 of India's 23
refineries with a combined refining capacity of 80.7 million tonnes per year. Indian Oil's cross-country
pipeline network, for transport of crude oil to refineries and finished products to high-demand centres,
spans over 13,000 km The company has a throughput capacity of 80.49 million tonnes per year for crude
oil and petroleum products and 9.5 million cubic metre per day at standard conditions for gas. On 19
November 2017, IOC, in collaboration with Ola, launched India's first electric charging station at one of its
petrol-diesel stations in Nagpur. Indian governments’ National Electric Mobility Mission Plan launched in
2013 aims at gradually ensuring a vehicle population of 6 to 8 million electric and hybrid vehicles in India
by 2020.

Refinery locations

• Barauni Refinery
• Bongaigaon Refinery
• CPCL, Chennai
• CPCL, Narimanam
• Digboi Refinery
• Guwahati Refinery
• Haldia Refinery
• Koyali Refinery
• Mathura Refinery
• Panipat Refinery
• Paradip Refinery

Pipelines

• Salaya - Mathura crude oil pipeline

• Mundra - Panipat crude oil pipeline
• Paradip-Haldia-Barauni crude oil pipeline
• Koyali - Mohanpura product pipeline
• Koyali - Ahmedabad product pipeline

3
• Guwahati - Siliguri product pipeline
• Barauni - Kanpur product pipeline
• Haldia - Mourigram - Rajbandh product pipeline
• Haldia - Barauni product pipeline
• Panipat - Jalandhar LPG pipeline
• Dadri - Panipat R-LNG pipeline
• Koyali - Ratlam product pipeline
• Koyali - Dahej/ Hazira product pipeline
• Panipat - Bhatinda product pipeline
• Panipat - Rewari product pipeline
• Panipat - Ambala - Jalandhar product pipeline
• Mathura - Delhi product pipeline
• Mathura - Bharatpur product pipeline
• Mathura - Tundla product pipeline
• Chennai - Trichy - Madurai product pipeline
• Chennai - Bangalore product pipeline
• Chennai ATF pipeline
• Bangalore ATF pipeline
• Kolkata ATF pipeline
• Paradip - Raipur - Ranchi product pipeline
• Jaipur Panipat Naphtha Pipeline
• Paradip - Hyderabad product pipeline

Foreign subsidiaries-

• Indian Oil (Mauritius) Limited

• IOC Middle East FZE

4
Employees

As of 31 March 2017, the company had 33,135 employees, out of which 2735 were women (8.25%). Its
workforce includes 16,545 officers. The attrition rate in Indian Oil is around 1.5%. The company incurred
INR 96.57 Billion on employee benefits during the FY 2016–17.

Listing and shareholding

Indian Oil's equity shares are listed on the Bombay Stock Exchange and National Stock Exchange of India.

As of September 2018, it was owned 57% by the Government of India (through the President of India), and
43% by other entities. The latter included corporate bodies (20%), ONGC (14%), LIC (6%), Foreign
portfolio investors (6%), Oil India Limited (5%) and Indian Mutual funds (4%).

This was similar to its shareholding in 2017. As of 31 December 2017, the Promoters Government of
India held approx. 56.98% of the shares in Indian Oil Corporation. The public held the rest 43.02% of the
shares - this includes Mutual Fund Companies, Foreign Portfolio Investors, Financial Institutions/ Banks,
Insurance Companies, Individual Shareholders and Trusts.

Indian Oil Corporation (IOC) buys a stake in Phinergy (Israel) for manufacturing, development, and sale
of aluminium-air batteries (Al-Air batteries) for electric vehicles. This joint venture is ready to facilitate the
development of Al-Air technology by intending to set up a factory in India.

Shareholders (as on 31-December-

Shareholding
2017)

Promoter Group (Government of India) 56.98%

Public 43.02%

Total 100.0%

5
Vision of IOCL

A major diversified, transnational, integrated energy company, with national leadership and a
strong environment conscience, playing a national role in oil security & public distribution.

Mission of IOCL

• To achieve international standards of excellence in all aspects of energy and diversified business
with focus on customer delight through value of products and services and costreduction.
• To maximize creation of wealth, value and satisfaction for the stakeholders.
• To attain leadership in developing, adopting and assimilating state-of- the-art technology for
competitive advantage.
• To provide technology and services through sustained Research and Development.
• To foster a culture of participation and innovation for employee growth and contribution.

Research & Development-

The R&D Centre continues to provide significant support to the Indian Oil Group refineries in product quality
improvement, evaluation of catalysts and additives, health assessment of catalysts, material failure analysis,
troubleshooting and in improving overall efficiency of operations.

India Oil's R&D Centre established that Biodiesel produced from Jatropha seeds were at par with that produced from
vegetable oils.

Indian Oil has, till date, invested close to Rs. 1,000 crores in setting up world-class facilities at its R&D Centre

It plans to invest about Rs. 500 crores during the period 2007-12 to maintain its leadership in downstream R&D
activities in the hydrocarbon sector.

6
Marketing-

• One of the largest petroleum marketing and distribution networks in Asia, with over 32,000
marketing touch points.

• The countrywide marketing operations are coordinated by 16 State Offices and over 100
decentralized administrative offices.

• The wide network of services offered by Indian Oil, Marketing Division, which includes;
commercial/reticulated LPG; total fuel management/ consumer pumps; Indian Oil Aviation Service;
LPG Business (non-fuel alliances); loyalty programs; retail business (non-fuel alliances) and
SERVO technical services.

7
 Indian Oil Corporation Limited

Type State owned organization

• BSE: 530965
Traded as
• NSE: IOC

ISIN INE242A01010

Industry Oil and Gas

Predecessor Indian Refineries Ltd. (1958)

Indian Oil Company (1959)

Founded 30 June 1959; 60 years ago

Headquarters New Delhi (headquarters)

Mumbai (registered office)

8
Area served India, Sri Lanka, Middle
East, Mauritius

Key people Sanjiv Singh (Chairman)

Products Petroleum
Natural gas
Petrochemicals

Revenue ₹605,924
crore (US$85 billion) (2019)

Operating ₹36,952
income crore (US$5.2 billion) (2019)

Net income ₹16,894

crore (US$2.4 billion) (2019)

Total assets ₹335,155

crore (US$47 billion) (2019)

Total equity ₹1,555

crore (US$220 million) (2019)

Owner Government of India (52.1%)

Number of 33,498 (2019)

employees

Subsidiaries Indian Oil (Mauritius) Ltd.

CPCL
Lanka IOC PLC
IOC Middle East FZE
Indane (LPG)

Website www.iocl.com

9
Bharat Petroleum Corporation Limited (BCPL) –

Bharat Petroleum Corporation Limited (BPCL) is an Indian government

controlled oil and gas company headquartered in Mumbai, Maharashtra .The Corporation operates two
large refineries of the country located in Kochi and Mumbai. The company is India's 2nd largest
downstream oil company and is ranked 275th on the Fortune list of the world's biggest corporations as of
2019. BPCL ranked 672 in the Forbes 2018 list.

History-

1891 to 1976

The company today known as BPCL started off as Rangoon Oil and Exploration company set up to explore
the new discoveries off Assam and Burma during the British colonial rule of India. In 1889 during vast
industrial development, an important player in the South Asian market was the Burmah Oil Company.
Though incorporated in Scotland in 1886, the company grew out of the enterprises of the Chef Rohit Oil
Company, which had been formed in 1871 to refine crude oil produced from primitive hand dug wells in
Upper Burma.

In 1928, Asiatic Petroleum Company (India) started cooperation with Burma oil company. Asiatic
Petroleum was a joint venture of Royal Dutch, Shell and Rothschilds formed to address the monopoly
of John D Rockefeller's Standard Oil, which also operated in India as Esso. This alliance led to the
formation of Burmah -Shell Oil Storage and Distributing Company of India Limited. Burmah Shell began
its operate operations with import and marketing of Kerosene.[4]

In the mid 1950s, the company began to sell LPG cylinders to homes in India and further expanded its
delivery network. It also marketed kerosene, diesel and petrol in cans in order to reach remote parts of
India. In 1951, the Burmah shell began to build a refinery in Trombay (Mahul, Maharashtra) under an
agreement with the Government of India.

10
Operations-

Bharat Petroleum operates the following refineries:

• Mumbai Refinery : Located near Mumbai, Maharashtra. It has a capacity of 13 million metric tonnes
per annum.
• Kochi Refinery : Located near Kochi, Kerala. It has a capacity of 15.5 million metric tonnes per
annum.
• Bina Refinery : Located near Bina, Sagar district, Madhya Pradesh. It has a capacity of 6 million metric
tonnes per year. This refinery is operated by Bharat Oman Refineries Limited, a joint venture between
Bharat Petroleum and Oman Oil Company.
• Numaligarh Refinery : Located near Numaligarh, Golaghat district, Assam. It has a capacity of 3
million metric tonnes per year.

The company business is divided in seven SBUs (Strategic Business Units), like Retail, Lubricants,
Aviation, Refinery, Gas, I&C and LPG.

They have popular Loyalty Program like Petrocard, Smartfleet.

Ownership-

As of September 2018, 54% of the shares of BPCL were owned by the Government of India (through
the President of India), with the rest owned by Foreign Portfolio Investors (17%), BPCL trust for investing
in shares (9%), Mutual funds and UTI (7.5 %), Insurance companies (6%) and the balance held by
individual shareholders. In 2019 government decided to make BPCL private by selling all its shares hence
making BPCL a private ltd company.

Vision-

We are the most admired global energy company leveraging talent and technology. We are the first choice
of customers, given our constant pursuit for customer service quality excellence. We exploit profitable
growth opportunities outside energy to give back to society and environment.

Mission-

" To develop core competence in Exploration and Production of oil and gas with focus on production;To
maximize wealth creation for meeting expectations of stakeholders; To create a pool of knowledgeable and
inspired employees and ensure their professional and personal growth”

11
Pipelines-

• Mumbai-Manmad-Bijwasan

• Bina-Kota

• Kota-Jobner

• Cochin Coimbatore Karur

• ATF-Mumbai Refinery-Santacruz

• ATF-Kochi Refinery-Kochi Airport

• Mumbai Uran

Major Products -

Bharat Petroleum Corporation Limited (BPCL) refines, stores, markets and distributes petroleum products.
The company’s key products include the following:

• Petrol

• Diesel

• Gasoline

• LPG

• Kerosene

• Lubricants

• Fuels

12
Type Public

Traded as BSE: 500547

NSE: BPCL

ISIN INE029A01011

Industry Oil and Gas

Founded 1976

Headquarters Mumbai, Maharashtra, India

Key people D Rajkumar

(Chairman & MD)[1]

13
Products Petroleum
Natural gas
LNG
Lubricants
Petrochemicals

Revenue ₹342,916
crore (US$48 billion) (2019)

Operating ₹11,968
income crore (US$1.7 billion) (2019)

Net income ₹8,527 crore (US$1.2 billion)

(2019)

Total assets ₹136,930

crore (US$19 billion) (2019)

Total equity ₹40,834

crore (US$5.7 billion) (2019)

Owner Government of India (52.98%)

Number of 12,157 (2018)

employees

Website www.bharatpetroleum.com

14
 Chapter-2
Oil and Gas Industry in India

15
Introduction

Indian oil and gas (O&G) sector marked its emergence way back in the late 19th century, when the oil was
first struck at Digboi in Assam in 1889. Since then, the sector has not seen back and has emerged as one of
the core sectors for the country's economy. India is working towards self-reliance in O&G segment and has
immense potential to achieve the same, as
about80 per cent of the country's sedimentary area is yet to be explored. Recent large-
scale oil and gas discoveries in theKrishna Godavari and Rajasthan basins have further consolidated India's
confidence to achieve the targets. The country's exploration and production sector is majorly dominated by
public sector corporations wherein Oil and Natural Gas Corporation (ONGC) accounts for the highest
market share.
India is the sixth largest consumer of oil in the world and the ninth largest crude oil importer. India’s oil
and gas sector contributes over 15% to the Gross Domestic Product (GDP). According to Ministry of
Petroleum and Natural Gas, India have a total reserve of 1201 million metric tonnes of crude oil and 1437
billion cubic meters of natural gas as on 01 April 2010. However, due to huge demand-supply gap in oil
and gas in India, it imports more than 60%of its crude oil requirement. Further, oil consumption in India is
projected to enhance by 4-5% per annum to 2015, indicating a demand of 4.01 million b/d by 2015.As per
the Business Monitor International (BMI) forecast, India will account for 12.4% of Asia Pacific regional oil
demand by 2015, while satisfying 11.2% of the supply. Due to increasing refining capacities, exports of
petroleum products are high in terms of the foreign currency amassed and accounts for 17% of the total
exports. India’s exports of refined products stood at 0.95 million barrels per day as of June 2011 and US$
4.6 billion worth of petroleum products were exported during July 2011. Vastness of this sector is
corroborated by the fact that there was a total of 130,000 people employed in the petroleum industry in
2009-2010.

Diesel & Petrol

• India's petroleum products' consumption grew by 0.1 per cent year-on-year (y-o-y) in November
2012, according to PPAC (Petroleum Planning and Analysis Cell). Cumulative growth for the
period April- November 2012 stood at 5.5 per cent.
• The petrol consumption recorded highest monthly growth at 13.9 per cent in November 2012 while
the high-speed diesel (HSD) recorded a growth of 1.7 per cent
• PPAC forecasts that India's petroleum production consumption would rise 6.1 per cent to 157.1
million tonne (MT) in FY13.
16
Gas

• India's shale gas reserves are at about 290 trillion cubic feet (TCF), of which 63 TCF could be
recovered, according to a study by US Energy International Agency. Shale gas is natural gas formed
from being trapped within shale formations.
• Natural gas sector constitutes about 9.8 per cent of primary energy consumption which is projected
to grow up to 20 per cent by 2025 as per Indian Hydrocarbon vision. About 65 per cent of natural
gas consumption is accounted by power and fertilizer sectors.
• The demand for natural gas in India has been growing, and is expected to increase by 280 per cent
from the current levels to 220 billion cubic meters (BCM) by 2020.

17
 Chapter-3

Research Methodology

18
INTRODUCTION

Research methodology is a technique which aim to provide insight about your research work like what is
the concerned problem, technique of data collection, technique of analysis of data and etc….. This all is
done to make reader understand the reliability and validity of your research.

RESEARCH OBJECTIVE

• To have thorough understanding of the concept of oil industry.

• To have thorough understanding of the various oil industry in India
• Compare the overall difference between various oil industry in India

METHODOLOGICAL APPROACH

The methodological approach used in this research is a mixed one mean includes both quantitative and
qualitative methods. The mixed approach is most appropriate for this research because this research
involves understanding of concepts as well as analysing of data used to make a suitable comparison
between mutual fund and fixed deposits on the basis of few concepts.

DATA COLLECTION

There are mainly two types of data available for any research to conduct i.e. primary data and secondary
data. The data used for this research is completely secondary. The secondary data that has been used is
collected from verified and authentic websites and sources.

ANALYSIS OF DATA

I have used thematic analysis method of analysing the data. Thematic analysis is the closely examining the
data to identify broad themes and patterns.

SCOPE OF THE RESEARCH

At present the research is carried out with the aim of understanding various oil industries in India.

19
 Chapter-4

Review of Literature

20
➢ “A Comparative Financial Performance Analysis: Study of Indian and Global Oil
Companies”
(By Rohit Bansal, Sanjay Kar, Saroj Mishra 2014)

After conducting a comprehensive financial ratio analysis of IOCL, BPCL, HPCL, CAIRN, BP, and
RDS, we arrived at the following conclusions: if liquidity ratios of all the companies are compared
then it is found that only IOCL and Cairn India have the ideal current ratio of 2:1. Cairn India has
higher acid test ratio (2010-14) than other companies, which shows it has better liquidity position
during the concerned periods.
However, by comparing the profitability ratio, BP and RDS have better ROA, but it has gone down
in the subsequent years, which shows that these companies efficiently used their assets to generate
earning and have outperformed other companies. They have also generated more profit with
shareholder’s investment compared to selected Indian oil companies. However their performance
showing decreasing trend. On the other hand, Cairn India has improved its ROE. The company’s
EPS has constantly increased which shows higher profitability per share as compared to all other
selected oil companies. Again, basic earning power of BP found to be constant around zero while
price earning ratio of BP recorded the highest earning among all. So we can say that, Cairn India,
BP, BPCL, HPCL and IOCL’s P/E has drastically decreased over the period. It was observed that
Cairn India had been a far more profitable company than other oil companies, which indicates it has
better control over its costs.

➢ “Indian Oil & Gas Industry – An Overview”

(By Sanjay Sakariya, Gujarat University)

The Indian Oil & Gas industry is growing rapidly and playing an important role for the
development of Indian economy. Being major consumer of energy resources, India has limited
supplies of oil. The demand-supply gap however is very high. The structured industry note gives an
overview and insights of the Indian Oil & Gas industry as a whole. It also appraises emerging
current scenario of Indian Oil & Gas industry. It further measures the progressive step taken by the
government towards India’s energy security through creation of conductive policy and regulatory
framework to promote Exploration & Production, Refining and Retailing of Oil and Gas for
competitive and healthy growth of the industry and country as a whole.

21
➢ “FINANCIAL PERFORMANCE ANALYSIS OF BHARAT PETROLEUM
CORPORATION LIMITED”

(By Anil Kumar Goyal, January 2020)

After the study of financial performance analysis of Bharat Petroleum Corporation Limited from
various financial aspects like profitability, liquidity and solvency, it can be concluded that the
profitability position of the company cannot be said satisfactory because the Gross Profit Ratio
varies from 1.67% to 3.91 % with the average of 3.04%. The gross profit ratio of 3% needs to be
improved. The second ratio of profitability is net profit ratio which varies from 0.48% to 2.58%
with the average of 1.43%. The net profit ratio of 1.43% is not satisfactory from any point of view
so company should concentrate on minimization of the expenses. The third and last measure of
profitability taken in the study is return on investment which varies from 3.73% to 15.64% with an
average of 10.15%. The return of 10% on investment to the investors is not so good or so bad; it
seems to be an average return on any investment.

The short-term solvency is measured by the current ratio and quick ratio. Undoubtedly the ideal
ratios cannot be applied in each and every industry, though the ideal current ratio is 2:1. The
company never even touched the ideal current ratio. It varies from 1.19:1 to 1.42:1 with an average
of 1.29:1 which is much less than the ideal ratio. The second ratio of liquidity is quick ratio; ideally
it should be 1:1. In the case of the BPCL it varies from 0.44:1 to 0.69:1 with an average of 0.58:1.
As in the case of current ratio the company was unable to even touch the ideal quick ratio during the
period of the study which may create problem to the short term liquidity.

➢ “Corporate Social Responsibility Practices in Indian Petroleum Companies”

(By Abhijit R. Das & Subhadeep Mukherjee, December 2018)

In India, petroleum companies are significantly contributing towards the CSR. A significant amount
of increase in CSR spending practices among the Indian petroleum companies can be seen. As
compare to spending practices in CSR by the Indian petroleum companies before the Companies
Act 2013 the activeness and the amount of spending in CSR has been increased significantly.

However, it is seen that almost all the petroleum companies did not fulfil the requirement of the
Act, i.e., not even spending 2% of the average net profit of the previous three years profit. But the
pattern of spending on CSR, the amount spent on CSR after the Companies Act 2013 has increased
significantly compared to before Companies Act 2013.

Moreover, for the successful implementation of CSR in India more and more depends on the
awareness among the public, participation of NGO’s, etc. are required.

22
 Chapter-5

Comparison between Indian oil corporation limited And Bharat

Petroleum corporation limited

23
Financials-

Equity Share Data

Table 5.1

IOC BPCL IOC/

Unit
Mar-19 Mar-19 BPCL

High Rs 181 455 39.8%

Low Rs 106 239 44.2%

Sales per share Rs 561.0 1,516.2 37.0%

Earnings per share Rs 18.3 43.4 42.3%

Cash flow per share Rs 27.4 60.7 45.1%

Dividends per share Rs 9.25 19.00 48.7%

Dividend yield % 6.4 5.5 117.7%

Book value per share Rs 119.5 197.1 60.6%

Shares outstanding m 9,414.16 1,966.88 478.6%

Bonus/Rights/Conversions B - -

Price / Sales ratio x 0.3 0.2 111.8%

Average P/E ratio x 7.8 8.0 97.7%

P/CF ratio x 5.2 5.7 91.7%

Price / Book Value ratio x 1.2 1.8 68.2%

Dividend Pay out % 50.4 43.8 115.0%

Average Market Capital Rs m 1,350,932 682,507 197.9%

No. of employees `000 33.5 11.9 281.6%

24
 IOC BPCL IOC/
Unit
Mar-19 Mar-19 BPCL

Total wages/salary Rs m 115,963 39,848 291.0%

Avg. sales/employee Rs Th 157,665.8 250,736.2 62.9%

Avg. wages/employee Rs Th 3,461.8 3,350.3 103.3%

Avg. net profit/employee Rs Th 5,156.7 7,169.9 71.9%

The above table shows the equity share data comparison of Indian Oil Corporation Limited and Bharat
petroleum Corporation Limited and according to it, the sales, earnings, cash flow, dividends, dividends
yield and the book value per share Bharat Petroleum Corporation Limited is comparatively more than that
of Indian Oil Corporation Limited. Shares outstanding of BPCL is more than that of IOCL. The average
market capital, dividend pay out, number of employees, average sales, average wages in IOCL is more as
compared to BPCL.

Figure 5.1

25
Figure 5.1 is the graph showing the book value of the shares of IOCL and BCPL from year 2015-2019. The
above graph shows that the book value of per share of IOCL is greater than the book value of shares of
BPCL from 2015 till 2019.

Figure 5.2

Figure 5.2 is the graph showing the earnings per shares of IOCL and BCPL from year 2015-2019. The
above graph shows that the earnings per share of IOCL is greater than the earnings per shares of BPCL
since 2015 till 2019. The above graph shows that there was a huge difference in the earnings per share of
both the companies from 2015 to 2019.

26
 Income data
Table 5.2

IOC BPCL IOC/

Unit
Mar-19 Mar-19 BPCL
Net Sales Rs m 5,281,489 2,982,256 177.1%
Other income Rs m 27,143 20,375 133.2%
Total revenues Rs m 5,308,632 3,002,631 176.8%
Gross profit Rs m 352,227 151,122 233.1%
Depreciation Rs m 85,065 34,178 248.9%
Interest Rs m 48,880 17,640 277.1%
Profit before tax Rs m 245,425 119,681 205.1%
Minority Interest Rs m 13,844 9,373 147.7%
Prior Period Items Rs m 0 0 -
Extraordinary Inc
Rs m 0 0 -
(Exp)
Tax Rs m 86,531 43,775 197.7%
Profit after tax Rs m 172,739 85,279 202.6%
Gross profit margin % 6.7 5.1 131.6%
Effective tax rate % 35.3 36.6 96.4%
Net profit margin % 3.3 2.9 114.4%

The above table shows the income data comparison between IOCL and BCPL. According to the
comparative analysis of income data of both the companies the net sales, total revenues, other incomes,
interest, depreciation, profit after tax, minority interest, taxes, gross profit margin, net profit margins is
more in IOCL than that of BCPL. But the effective tax rate in BPCL is more than IOCL.

The income of IOCL is more as compared to BCPL. According to the comparative analysis the income of
IOCL is double to that of BCPL.

27
 Figure 5.3

Figure 5.3 is the graph showing the net sales comparison between IOCL and BCPL. The above figure
shows the sales comparison of both the companies from 2015 to 2019. The graph shows that the net sales
of IOCL has always been greater than the net sales of BCPL.
Figure 5.4

Figure 5.4 is the graph representing the gross profit comparison of both the companies. The graph clearly
shows the gross profit of IOCL has always been greater and increased as compared to that of BCPL from
2015 to 2019
28
 Balance Sheet Data
Table 5.3

IOC BPCL IOC/

Unit
Mar-19 Mar-19 BPCL

Current assets Rs m 1,297,760 487,678 266.1%

Current liabilities Rs m 1,607,189 531,097 302.6%

Net working cap to

% -5.9 -1.5 402.4%
sales

Current ratio X 0.8 0.9 87.9%

Inventory Days Days 53 28 189.9%

Debtors Days Days 11 8 129.2%

Net fixed assets Rs m 1,726,679 629,693 274.2%

Share capital Rs m 91,810 19,669 466.8%

"Free" reserves Rs m 1,032,882 367,978 280.7%

Net worth Rs m 1,124,692 387,647 290.1%

Long term debt Rs m 391,525 343,156 114.1%

Total assets Rs m 3,351,551 1,369,304 244.8%

Interest coverage x 6.0 7.8 77.3%

Debt to equity ratio x 0.3 0.9 39.3%

Sales to assets ratio x 1.6 2.2 72.4%

Return on assets % 6.6 7.5 88.0%

Return on equity % 15.4 22.0 69.8%

Return on capital % 20.3 20.1 101.2%

Exports to sales % 0 0 -

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 Imports to sales % 0 0 -

Exports (fob) Rs m NA NA -

Imports (cif) Rs m NA NA -

Fx inflow Rs m 222,545 132,205 168.3%

Fx outflow Rs m 2,634,499 1,114,861 236.3%

Net fx Rs m -2,411,954 -982,656 245.5%

The above table shows the balance sheet comparison of both the companies. According to the above table
the current assets, current liabilities, total fixes assets, share capital of IOCL is more as compared to that of
BCPL.
The table shows that various ratios such as debt to equity and sales to assets of both the companies and
according to the comparison the debt to equity ratio of IOCL is lower than the ratio of BPCL and the sales
to assets ratio of IOCL is also lower than the ratio of BCPL.
Return on equity of IOCL is greater than that of BCPL, but the return on capital of IOCL is greater than
that of BPCL but there is not a major difference between the return on capital of both the companies.

Figure 5.5

30
Figure 5.5 shows the graph representing the total assets comparison of both the companies from 2015 to
2019. The graph shows that the total assets of IOCL is always greater than the total assets of BPCL.
The total assets of both the companies has constantly increased with the increase in time period.

Figure 5.6

Figure 5.6 shows the graph representing the debt to equity ratio of both the companies from 2015 to 2019.

31
 Cash Flow
Table 5.4

IOC BPCL IOC/

Unit
Mar-19 Mar-19 BPCL
From Operations Rs m 141,330 101,572 139.1%
From Investments Rs m -239,549 -104,512 229.2%
From Financial
Rs m 104,365 2,070 5,040.8%
Activity
Net Cashflow Rs m 6,146 -870 -706.5%

The above table shows the cash flow comparison of both the companies. The cash flow from operation of
IOCL is greater than BCPL. Cash flow from investments of IOCL is also greater than the BCPL. The net
cash flow of IOCL is greater than that of BCPL.

Figure 5.7

Figure 5.7 shows the graph representing the comparison of cash flows from operation of IOCL and BCPL
from 2015 to 2019.

32
 Figure 5.8

Figure 5.8 shows the graph representing the comparison of cash flows from investments of both the
companies from 2015 to 2019.

Figure 5.9

Figure 5.9 shows the graph representing the comparison of net cash flows of IOCL and BCPL from 2015 to
2019
33
 Shareholdings
Table 5.5

IOC BPCL IOC/

Unit
Mar-19 Mar-19 BPCL

Indian Promoters % 68.6 54.9 125.0%

Foreign collaborators % 0.0 0.0 -

Indian inst/Mut Fund % 4.6 15.9 28.9%

FIIs % 2.4 12.2 19.7%

ADR/GDR % 0.0 0.0 -

Free float % 24.4 16.9 144.4%

Shareholders 179,744 87,110 206.3%

Pledged promoter(s)
% 0.0 0.0 -
holding

The above table shows the comparison of shareholdings of IOCL and BCPL in march, 2019. According to
the table IOCL has Indian promoters as compared to BCPL.

Both the companies do not have any foreign collaborators.

The total no. of shareholders of IOCL is 179,744 and total shareholders of BPCL is 87,110. So, IOCL has
more number of shareholders as compared to BPCL.

34
Chapter-6

Conclusion

35
Indian oil and petroleum industry is a vast and diversified wholesome industry. In this work I have a brief
idea of Indian oil and petroleum industry and the major players of this industry. We have distinguished
between two major players of oil and petroleum industry i.e. Indian Oil Corporation Limited and Bharat
Petroleum Corporation Limited. In the project I concluded that oil and petroleum industry is a very major
necessity in the Indian economy. As India has a population of 1.3 billion and oil and petroleum is a
necessity to the country because India is not powered by electricity as a fuel. In this project I have found
that among the two major players of oil and petroleum industry i.e. Indian Oil Corporation Limited and
Bharat Petroleum Corporation Limited. Indian Oil Corporation Limited has a very vast operations and
investments as compared to Bharat Petroleum Corporation Limited.

36
 References
• https://www.iocl.com/
• https://www.bharatpetroleum.com/
• “A Comparative Financial Performance Analysis: Study of Indian and Global Oil
Companies”
(By Rohit Bansal, Sanjay Kar, Saroj Mishra 2014)
• “Indian Oil & Gas Industry – An Overview”
(By Sanjay Sakariya, Gujarat University)
• “FINANCIAL PERFORMANCE ANALYSIS OF BHARAT PETROLEUM
CORPORATION LIMITED”
(By Anil Kumar Goyal, January 2020)

• “Corporate Social Responsibility Practices in Indian Petroleum Companies”

(By Abhijit R. Das & Subhadeep Mukherjee, December 2018)

37