Ravi Chawla, Managing Director, Gulf Oil Lubricants India Ltd
The HCV industry is in a delirious moment of change. The Hinduja Group-owned Gulf Oil aims to be a global major in the lubricants industry. From meeting the surge in demand for its products to transition to BS-VI, Gulf Oil is future ready now. Ravi Chawla, Managing Director, Gulf Oil Lubricants India Ltd takes us through his growth blueprint. Interview excerpt:
Gulf Oil Lubricants has recently expanded partnerships with automotive Original Equipment Manufacturers. How you would like to strengthen partnerships in Heavy Commercial Vehicles segment?
Gulf Oil as a brand has always been at the forefront of using latest technology and providing reliable service. We provide world-class products to our clients through an in depth understanding of their requirements. In the automotive sector, we have recently announced our partnerships with Bajaj Auto, Force Motors and Fiat.
In the HCV segment, we already have partnerships with major OEMs including Ashok Leyland, Mahindra & Mahindra and Bharat Benz. Apart from maintaining our partnerships with major construction equipment OEMs such as L&T Construction Equipment and Kobelco.
Additionally, we are lubricant partners for some of the major infrastructure project developers’ namely ILFS, Oriental, Shapoorji Pallonji, JMC Projects, CEC Int’l Corporation. So, we provide right lubricant solutions for the right application across the infrastructure value chain. We are proud to be associated with some of the landmark infrastructure projects in India like Chennai Nashri Tunnel Project, Yamuna Expressway, Buddha International Circuit, CWC Nehru Stadium, Rashtrapati Bhawan Extension & ORR Road Hyderabad.
What is your assurance to the HCV OEMs as far as achieving productivity along with cost-efficiency?
With the aim to achieve higher productivity along with cost-efficiency, we ensure that HCV OEMs benefit from our extended oil drain intervals. Since every engine is different, every engine oil should be formulated as per the vehicle application. Therefore, the core of our OEM partnership lies with validation of our products in their engines or equipment for around 12-18 months under various operating conditions, keeping the intended long drain intervals in mind.
In India, we started focusing on OE tie-ups in 2006 and in the last 11 years, we have formed strong partnerships with manufacturers like Ashok Leyland, Bharat Benz, Volvo Penta, Mahindra & Mahindra, and Schwing Stetter.
What is the longest drain interval your products offer in the HCV and CE category?
When Gulf Oil pioneered the concept of long-drain diesel engine oils for commercial vehicles in India in 2006, the drain intervals were at 15,000 to 18,000 km. Then BS-III was just a year old. We introduced the long drain interval oils after thorough evaluation on vehicles in intra-city, inter-city and doubled the oil drain intervals for diesel engines up to 36,000 km co-branding it with Ashok Leyland.
In 2010, we had introduced yet another extra-long life engine oil with a drain interval of 80,000 km by following the similar validation process. We even increased the drain intervals of gear and axle oils which were for 40,000 km , 80,000 km and 1,20,000 km respectively to extend the service intervals.
How do you look at the recent performance of Gulf Oil?
In India in the last 10 years the lubricants industry has grown by about two per cent in volumes whereas we have been growing at a CAGR of 11 per cent. Today we are among the global top 15 lubricant companies and would like to be among the Top 10 lubricant companies in the world by 2020.
As per survey conducted by IMRB for Gulf Oil, Gulf Oil stands at #3 in brand recall survey amongst the lubricant brands of India. By 2020, we aim to stand at top #2 position amongst the Indian private sector lubricant companies.
In the recently announced Q2 earnings, Gulf Oils PAT increased and stood at Rs 40.42 crore, which is up by 38.05 per cent as compared to 29.28 per cent reported in the same quarter last year. This is primarily due to increase in OEM sales and our channel sales.
What is the status of your upcoming Chennai project?
The current lubricant plant at Silvassa has an overall capacity of 90,000 kilo litre (kl) per year. We are setting up a new blending plant near Chennai which will have an annual capacity of 40,000 kl to meet the increasing demand coming from the automotive and industrial sectors.
Our Chennai facility, Rs 190-crore greenfiled project is on target and is expected to start commercial production by end December. This will help us to serve OEMs and end-users across South India in a better way.
As the industry expects a shift from BS-IV to BS-VI – are you ready for this?
The government had earlier decided to leapfrog from BS-IV to BS-VI grade by 1st April 2020, skipping BS-V. This shift will require completely new type of engine oils with controlled SAPS (Sulphated Ash, Phosphorous, Sulphur), from what are being supplied today.
Gulf Oil has all the necessary approvals from leading global technical bodies and OEMs and is already supplying lubricants for the Euro-VI vehicles in Europe. In India, we are ready for this quantum leap and our lubricants can undergo testing at any given point of time.
To help the vehicle meet the BS-IV and BS-VI emission standards, Gulf Oil introduced AdBlue – an additive that reduces the most harmful substance – nitrogen oxide (NOx) – in diesel engine exhaust gases. Currently, we have more than 30 per cent of market share in AdBlue.
We have also recently signed on to be lubricant partner for Force Motors for commercial vehicles and will be providing AdBlue to them.
What are your expectations from the forthcoming EXCON?
As the economy is picking up and the large-scale projects across the country have started taking off, we are very much optimistic about the growth in infrastructure industry. Being South-Asia’s largest exhibition on construction equipment, EXCON will showcase new technologies, product and solutions that add value in terms of productivity and efficiency in the area of such project executions. We expect there is going to be a lot of interest from visitors who are going to be attending the event.
At Gulf Oil, we are enthusiastically looking forward to meet all the relevant OEMs under one platform and talk about extending partnerships. We would also expect end-users feedback for product quality assessment and new product development.