The Indian lubricants market produces around 2.9 billion litres per annum and is the third largest in the world after China and US. It is also one of the fastest-growing.
Come 2020, India will make the move to BS-VI emissions norms from the current BS-IV, bringing in a generational change and overhauling all existing vehicle manufacturing platforms. But what it will also change is the way the lubricants market behaves.
Patrick Carre, Vice President at Shell, and Mansi Tripathy, Managing Director at Shell India, spoke to Moneycontrol on the sidelines of an event where the company joined hands with Mahindra & Mahindra for the upcoming season of Formula E.
Edited excerpts:
Q: We are almost the end of 2018. How has the year been for the business?
A: Mansi Tripathy: 2018 has been one of the best years for the company. We had a double digit growth both on top line and bottom line. Through the year we made consistent progress in our core strategies. We increased our consumer outreach by close to 25 percent and we improved an overall improvement in brand equity. We have moved to close to 5,000 retailing points in the country. We have strengthened our partnerships with OEMs such as Hyundai, TAFE, Suzuki and Mahindra.
Patrick Carre: On the global map, India has done a tremendous job in contributing to our global growth. We have been the world’s leading lubricants brand in terms of market share for the 12th consecutive year. We serve seven of the 10 largest OEMs. It is important we defend and grow this market further in India.
Q: Where does India feature on the global map of lubricants markets?
A: Patrick Carre: India is definitely in the top ten. There are few markets that will be of bigger importance than India. It has tremendous potential in all three lubricants segments – passenger cars, transport and industrial lubricants. We are very well positioned for growth. We have 200 scientists working globally spending over $100 million just on lubricants in four global research centers one of which is in Bengaluru.
Q: Was India also the fastest growing market globally?
A: Mansi Tripathy: India is about 2.9 billion litres per annum and is the third biggest lubricants market in the world (after China and US). The rate of growth of 2.4 percent makes it one of the fastest growing globally.
Q: How is the company positioned for new investments?
A: Mansi Tripathy: Creation of new capacities is an on-going activity to look at future demand. We keep looking at input side which is supply and capacity and market side which is our distribution network. In both areas we will be making investments.
Q: India’s lubricants market has so many companies. How will you ensure growth?
A: Mansi Tripathy: Competition is good because that keeps technology at the best level. Shell as a group will be expanding in hydrocarbons, new energy, retail expansion and other solutions.
Patrick Carre: As technology advances in each market including India taking Bharat Stage VI as a specific example we see traditionally that technological hurdles increase to meet those standards. We are well positioned to manage that change given our global expertise.
Q: Is Shell on track to have the 1,200 retail stations in 10 years?
A: Mansi Tripathy: The retail business in on solid trajectory and expansion is going on as scheduled. We are further trying to see how to enhance the overall proposition to the consumer.
