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MARKETING STRATEGIES OF NON DOMESTIC NON EXEMPTED (NDNE) LIQUIFIED PETROLEUM GAS RETAILERS : A SELECT STUDY ON INDIAN OIL

CORPORATION LTD.

Faculty Guide Prof. DEBJANI BHATTACHARYA

Presented by KAUSTAV BORDOLOI Roll No : 2011054

34. (Estd. 1958). Indian Oil Corporation Ltd.8% national refining capacity and 71% downstream sector pipelines capacity in India. with Indian Oil Company Ltd.COMPANY PROFILE • Indian Oil Corporation Ltd. • . 1959) and Indian Refineries Ltd. marketing of natural gas and petrochemicals. • • IndianOil is India’s flagship national oil company with business interests straddling the entire hydrocarbon value chain – from refining. pipeline transportation and marketing of petroleum products to exploration & production of crude oil & gas. IndianOil and its subsidiary (CPCL) account for over 48% petroleum products market share. (Estd. was born on 1st September 1964 with the merger of Indian Refineries Ltd. is a public sector undertaking under Government of India and formed on the 1st of September 1964 through the merger of Indian Oil Company Ltd.

.OBJECTIVES OF STUDY • The focus of the study was to find out market potential of Non Domestic Non Exempted (NDNE) LPG in Guwahati Region. • To study the effect of appointing NDNE LPG Retailers by Indian Oil to maximize volume and profit in NDNE LPG. • The study aimed to find out the existing problems faced by Indian Oil in marketing NDNE LPG. • The study aims to find out the marketing strategies adopted by the competitors in NDNE marketing.

annual Reports 2011-12 of various LPG marketing companies and other online sources. Online data from Indian Oil web site. • DATA COLLECTION METHOD: Secondary data gathered from periodical Reports. official journals. business magazines. . Ministry of Petroleum and Natural Gas web site.RESEARCH METHODOLOGY • TYPE OF RESEARCH : EXPLORATORY based on the secondary data and primary data collected through personal unstructured probe so as to gather data to prepare the questionnaire. • SAMPLE AREA : The Sample area in which the research was done is the city GUWAHATI and adjacent area in Assam.

.• SAMPLING METHOD: Convenience Sampling was done as it contains homogeneity. These targets were given a questionnaire to fill and the research was done on the basis of that data. 50 were Hotels and Restaurants and 20 others were Fabrication units. It is also cost effective and faster • SAMPLE SIZE: The sample size used in this project was 100 of which 30 were LPG Distributors.

• PHYSICAL PARTICIPATION OF BRANDS Sales INDANE BHARAT GAS 2% 4% HP GAS 94% .

SALES OF LPG IN TOTALITY Sales 5% DOMESTIC LPG 95 % NDNE LPG .

DATA ANALYSIS • Market Share of NDNE LPG of Leading Gas Sales Companies INDANE BHARAT GAS HP GAS 3% 6% 91% .

RESPONSE FROM THE DISTRIBUTORS CATEGORYWISE SALES OF NDNE LPG 90 80 70 60 50 40 30 20 10 0 Canteens Column1 5 CATEGORY Tea Stalls/Sweet Shops 10 Fabrication units 2 Hotels and Restaurants 83 .

RESPONSE FROM THE HOTELS AND RESTAURANTS Sales Indane 5% HP BP 15% 80% .

67 per Kg) and that of a 19 Kg NDNE LPG cylinder is Rs 1417.2 Kg cylinder to commercial usage do not take place. This price difference of Rs 46.93 per Kg.2 Kg LPG cylinder meant for domestic use in Guwahati is Rs 393 ( Rs 27.distributors. This is required also to ensure availability of domestic cylinders to domestic consumers in time without backlog.0 Kg cylinders for commercial purpose.60 per Kg) during the period of study. • Due to this mismatch in rates there is a strong inclination by even commercial users to use domestic LPG cylinders in 14. government agencies to ensure that diversion of 14.2 Kgs. • There is a huge demand for subsiderized cylinders and therefore relative demand supply gap always remains.FINDINGS • All respondents have responded that they use 19.Hence strict vigil has to be maintained by companies. • No discounts are given to the customers of NDNE LPG cylinders. • The price of a 14.50 (Rs 74. .

• To sell a 14. • The share of NDNE in the LPG sales is 5%.Ensure supply in time.FINDINGS • IndianOil has developed sufficient storage and bottling capacity in the last year and LPG availability should not be a problem now in NE India. The NDNE retailers need to make more efforts to push the sales. . • For the domestic LPG(95% market share) the key focus is.Expiration of the Market. • LPG distributors get a commission of Rs 21.2 Kg cylinder no marketing effort is required to be put by the distributor as only supply has to be made by them. • For the NDNE LPG(5% market share) the key focus is.2 Kgs cylinder and Rs 50.00 per cylinder for selling a 19 Kg cylinder.94 per 14. The per Kg difference is not lucrative enough for the distributor to wholeheartedly erasure selling of NDNE LPG cylinders.

The LPG infrastructure of IndianOil in NE India as regards to production. IndianOil reach at every nook and corner of NE India through its vast LPG distributor network. Sales target of NDNE LPG is not given to the distributors.SWOT ANALYSIS • STRENGTH: 1. 3. . • WEAKNESS : 1.in terms of usage of domestic LPG. Monitoring. 2. Brand image of Indane is acceptable. Renewal of NDNE LPG cylinders – Booking patterns. 2. 3. storage and bottling capacity.

Fabrication shops potential. Boom is tea stall and sweet shop business. Hence it is expected that they will survive the competition which in term can create loss in marketing share. Piped gas of Assam Gas Company Limited is a major threat as it is very cheap and convenient. 2. All other players like BCPL and HPCL are government firms. 2. . • THREAT 1. OPPORTUNITY Boom in hotel and restaurant business in NE India.• 1. 3.

RECOMMENDATIONS AND CONCLUSIONS • NDNE LPG Distributor is to be opened immediately at Guwahati . • The number of NDNE distributors is to be so planned that each distributor handles 3000 to 4000 cylinders in month. Huge working capital will also not be required. • The distributors commission is to be changed from flat Rs 50. • Aggressive customer loyalty program /discount schemes is to be launched . This will take care of the fluctuation in NDNE LPG prices and protect the distributors interest in case of price rise as they will have to increase investment accordingly. This will enable the distributor to be viable . • All state capitals are to be targeted for opening one NDNE LPG distributor in each state capital.00 per cylinder to 5% of the rate before tax. .

• Requirement of setting a sales target for NDNE LPG distributors.FUTURE SCOPE • Will it be cost effective to create a separate distribution channel for NDNE LPG. . • To create monitoring which is dedicated only to NDNE.

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