A FINAL PROJECT REPORT ON

“A STUDY ON THE PREFERENCE OF PETROLEUMS

BUNKS AMONG THE CUSTOMER OF AUTOMOBILE
USERS”

SUBMITTED IN THE PARTIAL FULFILLMENT OF THE

REQUIREMENT FOR THE DEGREE OF “MASTER OF
BUSINESS ADMINISTRATION”

SUBMITTED TO: SUBMITTED BY:

Ms. KIRANJOT KAUR SANDEEP GUPTA
RIMT-IMCT MBA-VI sem
UNI. ROLL NO.
632222410

RIMT–INSTITUTE OF MANAGEMENT AND COMPUTER

TECHNOLOGY,
MANDI GOBINDGARH

PUNJAB TECHNICAL UNIVERSITY, JALANDHAR

SESSION (2006-2008)
 DECLARATION

Thereby declare that the project report entitled “A STUDY ON THE PREFERENCE OF
PETROLEUMS BUNKS AMONG THE CUSTOMER OF AUTOMOBILE USERS”
submitted for the degree of Master of Business Administration, is my original work and the
project report has not formed the basis for the award of any diploma, degree, associate ship,
fellowship or similar other titles. It has not been submitted to any other university or institution
for the award of any degree or diploma.

Place:
Date: Sandeep Gupta
MBA-VI Sem
 TO WHOM IT MAY CONCERN

This is to certify that Mr.Sandeep Gupta of MBA fourth semester of RIMT, Mandi Gobindgarh
has completed his project report on the topic of “A STUDY ON THE PREFERENCE OF
PETROLEUMS BUNKS AMONG THE CUSTOMER OF AUTOMOBILE USERS”
under the supervision of Ms. Kiranjot Kaur (faculty RIMT-IMCT)

To best of my knowledge the report is original and has not been copied or submitted anywhere
else. It is an independent work done by him.

Ms. Kiranjot Kaur

RIMT-IMCT
Mandi Gobindgarh
 ACKNOWLEDGEMENT

Without a proper combination of inspection and perspiration, it’s not easy to achieve anything.
There is always a sense of gratitude, which we express to others for the help and the needy
services they render during the different phases of our lives. We too would like to do it as we
really wish to express our gratitude toward all those who have been helpful to us directly or
indirectly during the development of this project.

First of all I wish to express my profound gratitude and sincere thanks to my esteemed learned
Director Dr. B.S. Bhatia, Director RIMT, Mandi Gobindgarh, who allowed me to conduct
the survey.

I extend my profound thanks obligation to Ms. Kiranjot kaur Lecturer who gave full attention
and guidance at each & every step. A depth of gratitude is owned to her for sparing her
valuable time. She took personal interest in spite of her numerous commitments & busy
schedules to help me in completing my project.

I am extremely grateful to Ms. Kiranjot kaur Lecturer for her valuable guidance and
supervision which helped me in completing my project successfully.

No words can adequately express my overriding debt of gratitude to my parents whose support
helps me in all the way. Above all I shall thank my friends who constantly encouraged and
blessed me so as to enable me to do this work successfully

Sandeep Gupta
MBA VI sem
CONTENTS
 SUMMMARY

Gone are the days when simply making the best quality products and services were enough.

Now something is required in addition to this to hold a customer that a company attracts

through its expensive marketing efforts. One such thing is customer loyalty cards and oil

marketing companies have been quick to understand the need to retain their customers.

Companies like Hindustan Petroleum, Bharat Petroleum and Indian Oil Corporation have

launched their loyalty cards which have very attractive features. Basically these cards are

prepaid cards for making purchases at petrol pumps. One can buy any thing from fuel,

lubricants and grocery items. Further, these cards provide services like insurance, vehicle

tracking system, reports, etc. The customer is benefited in various ways. He need not carry

cash with him while visiting petrol pumps. Whatever he purchases can get him incentives like

discounts, cash back, and gifts. There are many things that go through a customers mind when

he chooses a particular company. So it is very imperative to understand the factors that play a

determinant role. Companies need to properly market their loyalty programs and they should

be appropriately targeted. There are many problems which customers face while using the

cards, some of which are psychological and others are operational. Companies should try to do

away with these problems in order to attract more customers. In today’s competitive world,

companies don’t leave even a single stone unturned to make sure that they retain the customer,

once they get him. That means they try to make their customers loyal to their brands. Customer

loyalty describes the tendency of a customer to choose one business or product over another for

a particular need. In the packaged goods industry, customers may be described as being "brand

loyal" because they tend to choose a certain brand of soap more often than others. It is due to

intense competition that all the companies have more or less same strategies for their loyalty
programs and moreover, the features of the loyalty cards issued by them are also similar with a

little variation. An attempt has been made here to understand those subtle differentiators that

can help companies to make a difference. Numerous customer loyalty programs have resulted

from the efforts of countless companies, institutions and non-profit organizations to retain

customers. Each of these programs has some characteristics that distinguish it from the others.

The title of the customer loyalty program is irrelevant. What matters is that it achieves the

goals of increasing customer loyalty by offering true value.

•
Hindustan Petroleum Company Description
Hindustan Petroleum is India's second-largest oil refiner (Indian Oil is #1, Bharat Petroleum is
#3) and accounts for more than 20% of the country's total refining requirements. The company
has two major refineries -- one in Mumbai (formerly Bombay), the other in the southern Indian
city of Vishakapatnam -- and produces lubricants, aviation fuel, liquefied petroleum gas, and
light diesel oil. Hindustan Petroleum also holds a 17% stake in a refinery at Mangalore and is
establishing another refinery in the state of Punjab. Other businesses include pipelines, a lube
refinery, and a national network of service stations. The Indian government owns 51% of the
company, which was established in 1974.

HPCL PROFILE
The retail business unit of HPCL is oriented towards delivering better and faster service to
consumers. Recognizing that the consumers will be better served by offering them a wide
range of non-fuel services, the corporation has sized the opportunity through some extensive
market research banked initiatives. The new retail brand, ‘Club HP’ seeks to redefined the way
fuel are retailed in India. Offering the promise of outstanding care for the costumer and the
vehicle, Club HP intends to create a large base of loyal consumers who will look for the
distinct red and blue logo whenever they need fuel for their vehicle. Club HP outlets offer one
stop convenience so that one can do many things in same window of time - pay his bills, shop
for groceries, visit the ATM, get a quick check done on their vehicle and even arrange servicing
and repairs if need arises HPCL has introduced e-purse cum loyalty card - CLUB HP Smart1
for the benefit of prestigious customers at select Retail Outlets in Metros and Major cities. This
Card gets convenience in addition to rewards.

HPCL, a Fortune 500 company, is one of the major integrated refining and marketing oil
company in India. It is a mega Public Sector Undertaking (PSU) with Navratna status.
HPCL accounts for about 16% of the market share and 10.3% of the nation’s refining capacity
with two coastal refineries, one at Mumbai (West Coast) having a capacity of 5.5 MMTPA and
the other in Vishakapatnam (East Coast) with a capacity of 7.5 MMTPA. HPCL also holds an
equity stake of 16.95% in Mangalore Refinery & Petrochemicals Limited (MRPL), a state-of-
the-art refinery at Mangalore with a capacity of 9 MMTPA. HPCL is well on its way towards
setting up another grassroots refinery in the state of Punjab, called Guru Gobind Singh
Refineries Limited.
HPCL also owns and operates the country’s largest Lube Refinery, producing Lube Base Oils
of international standards. With a capacity of 335,000 Metric Tones. This refinery accounts for
over 40% of the country’s total Lube Base Oil production.
HPCL has returned “Excellent” performance for fifteen Consecutive year’s up to 2005-06,
since signing of the first MOU with the Ministry of Petroleum & Natural Gas. HPCL won the
prestigious MOU Award for the year 2005-06 for Excellent Overall Performance and for being
one of the Top Ten Public Sector Enterprises who fall under the ‘Excellent’ category. HPCL
performance for the year 2006-07 also qualifies for “Excellent” rating.

The Corporation over the years has moved from strength to strength on all fronts. Our refining
throughput has increased three fold between 1984/85 to 2006/07, rising from 4.47 million tones
in 1984/85 to 13.70 million tones currently.

Consistent excellent performance has been made possible by highly motivated workforce of
more than 10,891 employees working all over India at its various refining and marketing
locations.

Who Are We?

HPCL is a Fortune 500 company, with an annual turnover of over Rs 91,448 crores ($20892
Million) (FY 2006-07), 16% Refining & Marketing share in India and a strong market
infrastructure.

The Corporation operates 2 major refineries producing a wide variety of petroleum fuels &
specialties, one in Mumbai (West Coast) of 5.5 MMTPA capacity and the other in
Vishakapatnam, (East Coast) with a capacity of 7.5 MMTPA. HPCL holds an equity stake of
16.95% in Mangalore Refinery & Petrochemicals Limited, a state-of-the-art refinery at
Mangalore with a capacity of 9 MMTPA. In addition, HPCL is progressing towards setting up
of a refinery in the state of Punjab in the joint sector.

HPCL also owns and operates the largest Lube Refinery in the country producing Lube Base
Oils of international standards. With a capacity of 335 TMT. This Lube Refinery accounts for
over 40% of the India's total Lube Base Oil production.

The vast marketing network of the Corporation consists of Zonal offices in the 4 metro cities
and over 85 Regional offices facilitated by a Supply & Distribution infrastructure comprising
Terminals, Aviation Service Stations, LPG Bottling Plants, and Inland Relay Depots & Retail
Outlets. The Corporation over the years has moved from strength to strength on all fronts. Our
refining capacity steadily increased from 5.5 million tonnes in 1984/85 to 13.70 million metric
tonnes (MMT) presently. On the financial front, the turnover grew from Rs. 2687 crores in
1984-85 to an impressive Rs 91,448 crores in 2006-07.

OurMission

"HPCL, along with its joint ventures, will be a fully integrated company in the hydrocarbons
sector of exploration and production, refining and marketing; focusing on enhancement of
productivity, quality and profitability; caring for customers and employees; caring for
environment protection and cultural heritage.

It will also attain scale dimensions by diversifying into other energy related fields and by
taking up transnational operations."

Our Vision: Vision 2020

To be a World Class Energy Company known for caring and delighting the customers with
high quality products and innovative services across domestic and international markets with
aggressive growth and delivering superior financial performance. The Company will be a
model of excellence in meeting social commitment, environment, health and safety norms and
in employee welfare and relations.

PETROL

Gasoline or petrol is a petroleum-derived liquid mixture consisting mostly of aliphatic

hydrocarbons and enhanced with aromatic hydrocarbons toluene, benzene or iso-octane to
increase octane ratings, primarily used as fuel in internal combustion engines. Most
Commonwealth countries or former Commonwealth countries, with the exception of Canada,
use the term "petrol" (abbreviated from petroleum spirit). The term "gasoline" is commonly
used in North America where it is often shortened in colloquial usage to "gas". This should be
distinguished in usage from genuinely gaseous fuels used in internal combustion engines such
as liquified petroleum gas (which is stored pressurised as a liquid but is allowed to return
naturally to a gaseous state before combustion). The term mogas, short for motor gasoline,
distinguishes automobile fuel from aviation gasoline, or avgas. The word "gasoline" can also
be used in British English to refer to a different petroleum derivative historically used in lamps;
however, this use is now uncommon.

Diesel
Diesel or diesel fuel is a specific fractional distillate of petroleum fuel oil or a washed form of
vegetable oil that is used as fuel in a diesel engine invented by German engineer Rudolf Diesel
in cooperation with the German conglomerate MAN AG. The term typically refers to fuel that
has been processed from petroleum, but increasingly, alternatives such as biodiesel or biomass
to liquid (BTL) or gas to liquid (GTL) diesel that are not derived from petroleum are being
developed and adopted. For clarity, petroleum-derived diesel is increasingly called petrodiesel.

Although Rudolf Diesel's name has become attached to the compression combustion engine
and the fuel that it consumes, he was not first to invent the diesel engine. His patent was filed
in 1893. However, Herbert Akroyd Stuart built the first compression-ignition oil engine in
Bletchley, England, in 1891. He leased the rights to Richard Hornsby & Sons in July 1892, five
years before Diesel's prototype was built

Lubricant

A lubricant (sometimes referred to "Lube") is a substance (often a liquid) introduced between

two moving surfaces to reduce the friction and wear between them. A lubricant provides a
protective film which allows for two touching surfaces to be separated and "smoothed," thus
lessening the friction between them. Lubricants chemically interact with all surfaces so that
contact only occurs with the smooth and free lubricant. By this process, abrasive particles are
dissolved into the lubricant, thus making them also very good solvents and cleaners.
Petroleum-based lubricants like vasoline tend to dissolve petroleum products such as rubber
and plastic, while water-based lubricants tend to dissolve polar chemicals (like water and dirt);
hence the additives. The lubricant must be replaced when it has dissolved to saturation, because
the inability to dissolve additional abrasive debris allows abrasive particles to scrape against or
become lodge in the working surfaces, thus introducing a margin for physical contact between
between them. Lubricants which dissolve working surfaces (like the petroleum products
vasoline with rubber) defeat their purpose by corroding the smooth surfaces by their own
dissolving power, thus compromising structural integrity, surface smoothness, and system-wide
contamination.

Quality Policy
Total customer satisfaction through quality products by doing it right the first time, every time.
Ensure consistency of quality , and adherence to time deadlines.
Strive to achieve excellence in quality through training, ,motivation, team work and continuos
upgradation of technology.
To take appropriate steps to minimise wastage, increase productivity and optimise the quality
of products and services in a cost effective manner

Details about Club HP Smart

1. Club HP Smart1 is e-purse cum loyalty card with an attractive rewards program. ‘Club HP
Smart 1’ Card gives value up to 5% rewards on spends - for petrol/diesel fills, lubricants, car
servicing, for tyres, batteries & accessories and for grocery purchased at HP Speedmart.
2. CLUB HP Smart 1 is the only card in India, which offers free fuel, that too, on the spot.
3. The Club HP Smart1 Card is e-purse cum loyalty smart card. The card stores information
about the amount in rupees that one has loaded in card. One earn points every time one transact
on this card. These points can be exchanged for free fuel on the spot.
4. One can load the card for a minimum load amount of Rs.250 and above in multiples of
Rs.50, such as Rs.300, Rs.350, etc. The card can be loaded at select HP Retail outlets. The card
gets automatically debited according to spends.
5. Advantages of becoming a Club HP Smart 1 member:
• Convenience. No need to carry cash

• Get more from your regular day-to-day fuel expenses

Every time one makes purchases at select HP Retail outlets, one earns up to 5% rewards in the
form of Smart miles. Accumulate these Smart miles and redeem them at any participating HP
Retail outlet for petrol, diesel, premix fuel, lubricants, servicing, tyres, batteries and
accessories.
About Us
IndianOil, September 17, 2007 Indian Oil Corporation Ltd. is currently India's largest
company by sales with a turnover of Rs. 220,779 crore (US $51 billion), the highest-ever for an
Indian company, and profits of Rs. 7499 crore (US $1.73 billion) for fiscal 2006. IndianOil is
also the highest ranked Indian company in the prestigious Fortune 'Global 500' listing, having
moved up 18 places to the 135th position this year based on fiscal 2006 performance. It is also
the 20th largest petroleum company in the world. IndianOil's vision is driven by a group of
dynamic leaders who have made it a name to reckon with.

In this section you can peruse through the profile and spread of IndianOil across the country &
abroad. You can also know about IndianOil's current financial performance, special initiatives
and causes along with the prestigious recognitions & awards that has come its way for
exceptional performances.
Vision A major diversified, transnational, integrated energy company, with national leadership
and a strong environment conscience, playing a national role in oil security& public
distribution.
Indian Oil Corporation Ltd. was formed in 1964 with the merger of Indian Refineries Ltd.
(Estd. 1958). IndianOil and its subsidiaries account for 47% petroleum products market share,
40.4% refining capacity and 67% downstream sector pipelines capacity in India.

For the year 2006-07, the IndianOil group sold 57.97 million tonnes of petroleum products,
including 1.63 million tonnes of natural gas and exports of 3.13 million tones

Corporate Messages

Indian Oil, September 17, 2007 Indian Oil is a diversified,

transnational integrated energy company with a strong
commitment towards conserving the environment. It
plays a significant role in the nation’s oil security and public distribution.
Log into Indian Oil’s values, mission and vision reflected in its multiple advertisement
campaigns in the recent past.
The Indian Oil Group of companies owns and operates 10 of India's 19 refineries with a
combined refining capacity of 60.2 million metric tones per annum (MMTPA, i.e., 1.2 million
barrels per day). These include two refineries of subsidiary Chennai Petroleum Corporation
Ltd. (CPCL) and one of Bongaigaon Refinery and Petrochemicals Limited (BRPL).

The Corporation's cross-country crude oil and product pipeline network spanning about 9,300
km, the largest in the country, meets the vital energy needs of the consumers in an efficient,
economical and environment-friendly manner.

Having commissioned projects valued at over Rs. 10,000 crore (US $ 2.3 billion) in 2006-07,
IndianOil is investing Rs. 43,250 crore (US $10.65 billion) more during the XI Plan period
(2007-12) in augmentation of refining and pipeline capacities, expansion of marketing
infrastructure and product quality upgradation as well as in integration and diversification
projects.

Network Beyond Compare As the flagship national oil company in the downstream sector,
IndianOil reaches precious petroleum products to millions of people everyday through a
countrywide network of about 32,500 sales points. They are backed for supplies by 170 bulk
storage terminals and depots, 101 aviation fuel stations and 89 Indane LPG bottling plants.

IndianOil operates the largest and the widest network of petrol & diesel stations in the country,
numbering about 16,600. It reaches Indane cooking gas to the doorsteps of over 47.5 million
households in 2,671 markets through a network of 4,990 Indane distributors.

IndianOil's ISO-9002 certified Aviation Service commands a 63% market share in aviation fuel
business, meeting the fuel needs of domestic and international flag carriers, private airlines and
the Indian Defence Services. IndianOil also enjoys a dominant share of the bulk consumer
business, including that of railways, state transport undertakings, and industrial, agricultural
and marine sectors.

IndianOil's world class R&D Centre is perhaps Asia's finest. Besides its pioneering work in
lubricants formulation, refinery processes, pipeline transportation and alternative fuels such as
bio-diesel, the Centre is also the nodal agency of the Indian hydrocarbon sector for ushering in
Hydrogen fuel economy in the country. IndianOil joined the league of global technology
providers in 2006-07 with the selection of its in-house developed

Indian Oil Corporation

IndianOil is also the highest ranked Indian company in the prestigious Fortune ‘Global 500’
listing, having moved up 17 places to the153rd position this year based on fiscal 2005
performance. It is also the 21st largest petroleum company in the world and the # 1 petroleum
trading company among the National Oil Companies in the Asia-Pacific region.

1.) Xtra Power Fleet Card

The IndianOil XTRAPOWER Fleet Card Program is a complete fleet management solution for
Fleet Owners / Operators and Corporate. XTRAPOWER is a Smart Card based Fleet Card
Program, which facilitates cashless purchase of fuel & lubes from designated retail outlets of
IndianOil thru' flexible prepaid and credit* facilities. The fleet card program also offers an
exciting Rewards Program and unique benefits like personal accident insurance cover and
vehicle tracking facilities. Every time one fills your fleet with fuel & lubes using
XTRAPOWER fleet cards at designated retail outlets of IndianOil, one can earn XTRA Points.
One can exchange accumulated XTRA Points for attractive gifts from XTRAPOWER Rewards
Catalogue including free fuel & lubes.

Benefits:
 Convenience: It frees one from the inconvenience of transacting in cash for auto fuel
and lubes purchases. One no longer needs to hand over cash to drivers and keep manual
account of fuel/lubes expenses. With fleet card membership, one get periodical reports
on fuel consumption for each of enrolled vehicles.
  Q&Q Assurance: XTRAPOWER fleet card facility provided at only select Q&Q
assured outlets on all major highways and halting points.
 Flexible Reloading: This unique feature of XTRAPOWER Fleet Card allows
reloading any of fleet cards from wherever the customer es. For example, one can make
payments in Mumbai and reload a fleet card being used by one’s driver in Chennai.
 Transaction Slip: Every time vehicle makes a purchase of fuel/lubes at a designated
retail outlet of IndianOil, a transaction slip is generated. The transaction slip contains
the date and time of purchase at the retail outlet, the value of purchase and the odometer
reading of the vehicle (if given by the driver).
 Fleet Management Report: This is a consolidated monthly report on fuel consumption
for all vehicles enrolled under the fleet card program, which gives details of vehicle-
wise transactions with odometer readings as well as balance of XTRA Points earned on
each of the card.
 Fleet Tracking: One can track vehicle movements based on Sale, Reload and Tracking
transactions on fleet cards. One can view yesterday's transactions by logging on to
www.iocxtrapower.com, which will include date, time and location of transaction.
An optional eTracK System is also available (at an extra cost) for XTRAPOWER fleet card
members, which offers real time truck tracking even in remote areas through BSNL's
countrywide cellular network. (See FAQ for details)
 Rewards Program: On every purchase of fuel/lubes through XTRAPOWER fleet card
(except for cards with interest-free credit facility), one can earn XTRA Points. The
XTRA Points accumulated by a card member can be redeemed for a choice of reward
items from the XTRAPOWER Rewards catalogue including fuel/lubes
 Insurance Cover: XTRAPOWER fleet card membership offers unique personal
accident insurance cover for the card member as well as driver(s) and cleaner(s) of the
enrolled vehicles. The program also offers lost card liability cover to the card members
so as to protect against misuse of a lost/stolen card.

2.) xtra Rewards

On March 26, 2007 Mr. G.C.Daga, Director (Marketing), Indian Oil handed over Indian Oil’s
first online cash customer loyalty card “Xtra Rewards". Xtra Rewards is the first reward
programme for customer's paying cash. It is commonly assumed that plastic money or credit
and debit cards are the most popular means of purchase. But even today about 90% of the
people who drive into petrol pumps pay in cash. With Xtra Rewards, such cash customers can
add value to their purchases by piling up loyalty points. These loyalty points are accrued even
for customers paying through credit and debit cards. The card is backed by Tata Indicom's
CDMA (Code Division Multiple Access) based PDSN (Packet Data Switching Node)
technology which will act as the communication back bone with HDFC Bank providing the
POS (Point of Sale) Terminals at our ROs. Axalto has written the Host Communication
Protocol and the Application for the POS Terminals. The back end loyalty program manager is
One to One Marketing Solutions while the middleware has been written by NCST(formerly
CDAC). Each transaction will be confirmed on-line thru a charge slip. The Program can track
and communicate sales promo offers at the Point of Purchase through the charge slip as well as
SMSs sent to the cardholder's registered mobile number. While customers can earn points on
fuel/lube purchases at participating Indian Oil ROs, additional points earning opportunities
outside the Indian Oil network is being brought in thru national and local alliances covering
FMCG, Food, Automobile, Travel, Entertainment, Apparel and Hospitality sectors. The new
Indian Oil XTRAREWARDS Program is not all about just loyalty it also seeks to regularly
provide privileged benefits and offers from Program Partners. In Bangalore, the program
partners are Domino's Pizza, JK Tyres, Rediff Shopping, MTR Foods and Gulf Car Care
Products. The Program also seeks to inculcate the habit of redeeming points, which no other
program encourages. This on-line Program is designed to run tailor-made sales promotions at
both the macro and micro levels. Customers and Merchants have been provided on-line access
through a 24x7 IVRS Help Line, SMS Platform, Web Site and Call Centre besides the POS
Terminal at the Retail Outlets. In the first phase in Bangalore, XtraReward will be launched in
60 IndianOil retail outlets.

Products of INDIAN OIL CO. LTD.

MS/Gasoline
Updated on February 21, 2008 Automotive gasoline and gasoline-oxygenate blends are used in
internal combustion spark-ignition engines. These spark ignition engine fuels are primarily
used for passenger cars. They are also used in off-highway utility vans, farm machinery and in
other spark ignition engines employed in a variety of service applications.

Gasoline is a complex mixture of relatively volatile hydrocarbons that vary widely in chemical
& physical properties and are derived from fractional distillation of crude petroleum with a
further treatment mainly in terms of improvement of its octane rating. The hundreds of
individual hydrocarbons in gasoline range from c4 to c11.

An oxygenate is an oxygen-containing, ashless organic compound (such as an alcohol or ether)

which can be used as a fuel or fuel supplement. Motor gasoline is sold at retail outlets where it
is directly delivered into the automobile tank. The Indian Standard governing the properties of
motor gasoline & gasoline-oxygenate blends is IS 2796 : 2000 (3rd Rev).

In view of the auto fuel policy issued by Govt of India, more & more stringent specifications
(equivalent to Euro II, Euro III, Euro IV) are being made applicable for the gasolines being
marketed in India. This has led to reduction of environmentally polluting factors in gasolines.

High Speed Diesel

Updated on February 21, 2008 Petroleum derived diesel (called as petrodiesel) is a mixture of
straight run product (150 °C and 350 °C) with varying amount of selected cracked distillates
and is composed of saturated hydrocarbons (primarily paraffins including n , iso , and
cycloparaffins), and aromatic hydrocarbons (including napthalenes and alkylbenzenes).

Diesel is used in diesel engines, a type of internal combustion engine. Rudolf Diesel originally
designed the diesel engine to use coal dust as a fuel, but oil proved more effective. Diesel
engines are used in cars, motorcycles, boats and locomotives. Automotive diesel fuel serves to
power trains, buses, trucks, and automobiles, to run construction, petroleum drilling and other
off-road equipment and to be the prime mover in a wide range of power generation & pumping
applications. The diesel engine is high compression, self-ignition engine. Fuel is ignited by the
heat of high compression and no spark plug is used.

The Indian Standard governing the properties of diesel fuels is IS 1460:2005 (5th Rev).
Important characteristics are ignition characteristics, handling at low temperature, flash point.
Diesel fuel often contains higher quantities of sulphur. In India , emission standards (equivalent
to Euro II, Euro III, Euro IV) have necessitated oil refineries to dramatically reduce the level of
sulphur in diesel in view of the auto fuel policy brought in force by Govt of India.

Lubricants & Greases

IndianOil, October 04, 2007 Lubrication & Tribology

The art of reducing friction between rubbing/rolling surfaces is called Lubrication. The
external Solid or Fluid used as a medium to reduce friction in rubbing/rolling surfaces is called
lubricant. The whole mechanism including lubricant used for ensuring lubrication through
lubricant is called lubrication system. In the recent past two terminologies have gained
importance – Tribology which means science of Rubbing and Rheology which means science
of stream/flow. Thus Tribology includes Lubrication, Rheology, material properties, material
surface properties etc. Lubrication was known to mankind centuries ago as evident from grease
lubricated chariot wheels. However the rapid development of this science can be said to have
started from 18th century and significant technological progress, commercial usage was made
in 20th century.

LubricatingOils
Most lubricants used in variety / quantity are liquids. Water is natural lubricant but has
extremely limited application due to very low viscosity, very low boiling point and water
causes rusting/ corrosion. Vegetable oils have excellent lubrication property but also have
many limitations like very poor oxidation stability, high pour point rapid thickening and may
even give foul smell after some operation. Vegetable oils like Castor Oils were used on very
large scale till 1925 or so. Vegetable oils are still used directly or as an additive in some
applications. Most of the liquid lubricants used at present all over the world are mineral oils,
which are petroleum-based oils. These are very complex mixture of variety of hydrocarbons
having desired lubrication properties segregated from other hydrocarbons through various
processes to remove undesired hydrocarbons like aromatics, olefins, waxes, mercaptans
asphaltenes etc. Thus the process is by removing undesired hydrocarbons.

Base Oils

The latest process technology in vogue for decades for making lubricating oil base stocks is by
transforming undesired hydrocarbons into desired hydrocarbons through hydrocracking,
hydrofinishing hydrodesulfuring etc. This process technology improvement gives benefit of
improving colour to almost waterwhite, improving viscosity index, reducing sulphur &
benzene content, isomerisation causing lower pour point and increasing the yield. Such highly
refined lube base stocks are called Group II and Group III base oils where as previous
conventional method processed base oils are called Group I base oils. Haldia Refinery of
Indian Oil produces Group I / II/III base oils at Haldia. CPCL refinery of Indian Oil produces
Group I base oils at Chennai.

Lubricating oil is not a specific chemical to have fixed chemical formula. Nor it is a definite
mixture of hydrocarbons in exactly specific component distribution pattern. Lubricants are
therefore decided by their group property or group behaviour. Thus lubricating oil base stocks
can have different colours, viscosities, stabilities, properties etc depending on several factors –
source – refining technique etc.

Viscosity of Lubricating Oil is most important characteristic. As viscosity changes with change
in temperature, this behaviour becomes another important characteristic of lubricant. Thermal/
chemical/Oxidation stabilities, demulsibility property, air release property, de-foaming property
etc are other important characteristics for lubricant.
Additives are added at different proportions to impart or to promote certain lubrication
properties as per the application requirements. Thus lubrication formulation becomes complex
subject, formulations vary from application to application, manufacturer to manufacturer and
this is how the lubricants become proprietary grades of manufacturers/marketers. At the same
time OEs and institutions may bring out some specifications and standards to evaluate
lubricants or to specify lubricants.

Synthetic Lubricants

Synthetic Lubricants are generally hydrocarbons as in case of mineral oils or may be

hydrocarbons with some oxygen as in case of vegetable oils or can be even void of
hydrocarbons. What actually differentiates is that synthetic lubricant means specially
synthesized lubricant – to make it specific chemical or mixture of extremely small range of
chemicals which will give sharp focused lubrication properties as per exacting requirements.
Therefore synthetic lubricants can be much superior to mineral lubricants, but will be
extremely costly and therefore user has to make trade off. This is why mineral lubricants
constitute major portion in lube market.

Lubricating Greases
These are primarily lubricating oils thickened with some thickener like metallic soaps/ non
metallic other materials like clay. Thickening is to ensure that the lubricant remains where it is
applied without leaking/ dripping. The Lubricating Oil used does the basic lubrication. The
thickener used also imparts some specific lubrication properties. Additives are also used as in
case of lubricating oils to impart / promote specific properties. Use of grease is limited as
compared to use of lubricating oil but there are several situations warranting use of grease only.
Brief History of BPCL
Bharat Petroleum Corporation (BPCL) traces its history to 1928 when the Burmah Shell Oil
Storage & Distribution Company of India was incorporated in England to enter the petroleum
products business in India. The business of the Company grew substantially given the
international backing of Shell and it achieved the leadership position in India. In 1952, Shell
and Burmah Oil Company set up Burmah Shell Refineries to set up a refinery in Mumbai. The
entire operations of Burmah Shell in India were nationalised in 1976 and the Refinery and
Marketing Companies were merged to form BPCL.

BPCL is India's second largest oil company in terms of market share and processes about 9
million metric tons of crude per year. Today the company produces a diverse range of products,
from Petrochemicals and Solvents to aircraft fuel and speciality lubricants. It manufactures
petroleum and petroleum products, asphalt, bituminous substances, carbon, carbon black,
hydrocarbons, mineral substances and the products/by-products derived there from.

The organisation structure of BPCL was revamped and six new Strategic Business Units
(SBU's) have been created. They are Refinery, Retail, Industrial& Commercial, Lubricants,
Aviation. LPG. The new structure is based on business processes, is flexible, more responsive
to external changes, has fewer layers, and above all, ensures a much higher customer focus.

During 2000-01 the company issued bonus shares in the ratio of 1:1, thereby enhancing its
equity capital to Rs 300 crores. Currently BPC holds 54.81% in KRL and 62.96% in NRL.
Government has a 66% stake in the company, which it plans to divest in due course of time.
The contenders for the same include MNCs like Shell along with domestic companies like
Reliance Industries. A possible cross holding between BCPL and HPCL is also proposed.

Refinery Modernization Project is being implemented at a cost of Rs.18,310 million . This

project besides improve distillate yield and energy efficiency, will enhance the crude oil
capacity to 12 MMTPA. The project is expected to be commissioned October,2004. Gas
Turbine and Heat Recovery Steam Generator project was commissioned during 2001-02 at a
cost of Rs.1750 million. The long term plan of setting up a 7 MMTPA capacity grassroots
refinery project in Allahabad District of UP is under final stage of approval. The forestland of
450 acres has been approved and the estimated cost of the Refinery project amounts to 61,800
million. This project is planned in such a way it should be mechanically completed within 48
months from the date of receipt of all statutory approvals.
IndianOil nets Rs 111-cr savings IBP merger Business Line, New Delhi, December 06, 2007

The merger of IBP brings home an annual savings of Rs 111 crore in operations cost of the
merged petroleum retailing business of IndianOil , beginning this year. However, beginning
August 2007, IndianOil brought the entire petroleum retail business under its marketing
division. IBP division is managing only the explosives and cryogenics business.

The restructuring was studded by wide-scale change in marketing network and logistics. Since
IndianOil has adequate storage logistics in place to supply to the nooks and corner of the
country, all six depots of IBP were closed. This apart, IBP had a marketing and administrative
network of 30 divisional offices, four regional offices, one LPG office in Delhi, registered
office in Kolkata and corporate head office in Mumbai to manage over 3,000 outlets. The entire
network was closed.

On the other hand to manage a combined network of 16,455 retail outlets across the country,
IndianOil had increased its divisional office network by 16 from 49 to 65. The existing regional
offices of IndianOil were found adequate to manage the merged business operations.

"Overall we have estimated an annual savings of approximately Rs 111 crore by restructuring

the operations. The bulk of the savings Rs. 66.4 crore will be attributed by closure of four
regional offices of IBP. An annual saving of Rs 24 crore through closure followed this of IBP
corporate office. The net savings on divisional network is Rs 13.8 crore, a company official
said.

The phase-out of IBP lube brands has led to further reduction in cost of operations. IBP's lube
blending facility in Kolkata is now used for manufacturing of IndianOil brands. Meanwhile, a
project has been initiated to give a facelift to IBP outlets by increasing the scope of automation
and customer comfort IBP outlets did not receive much investment during the last few years.
IndianOil will spend approximately Rs 150-200 crore to upgrade 1,000 such outlets in the first
phase.

Company Background

Background
Incorporation Year 1976
 Bharat Bhavan, 4&6 Currimbhoy Rd Ballard
Registered Office
Est., Mumbai - 400001, Maharashtra

Telephone 91 - 022 - 22713001-004

Fax 91 - 022 - 2616793/2642112
Industry Refineries
House GOI - BPCL
Chairman & Managing Director Shri Ashok Sinha
Company Secretary Shri N. Viswakumar
Auditor M/s. B. K. Khare & Co.
Face Value 10
Market Lot 1

Mumbai, Chennai, Delhi, Kolkata, and National

Listing Stock Exchanges
Stock Exchange of India Ltd

Bharat Petroleum Corpn Ltd

Bharat Bhavan, 4 & 6 Curimhoy Rd, Ballard
Registered Office
Estate,
Mumbai - 400 001

Ashok Sinha TITLES Chairman,

Managing Director,
Director of Finance and Member of
Investors' Grievance Committee

Dear Shareowners,
On behalf of the Board of Directors and on my own behalf, I would like to extend a very warm
welcome to all of you to the 54th Annual General Meeting of Bharat Petroleum Corporation.

The Notice of the AGM, Directors' Report and Audited Accounts for the year ended 31st
March 2007 are already with you and with your permission, I take them as read.

The year 2006-2007 has been an exceptional year and the Company has delivered outstanding
results on all fronts. For the first time in its history, BPC's sales turnover has crossed the
Rs.1,000 billion mark ! BPC has also achieved the highest ever levels of quantity of crude oil
processed at its refineries in Mumbai and Kochi and market sales volume. Consequently, BPC
has achieved its highest ever profit during the year. The year also marked the formal integration
of operations and systems of the erstwhile Kochi Refineries Limited (KRL), consequent to its
merger with BPC. It gives me immense pleasure to inform you that integration has been
completed seamlessly and the merged entity is fully geared up to meet the growing challenges
in the market.

Due to its impressive performance, BPC has moved up in the 'Fortune Global 500' list with a
ranking of 325 and currently, BPC occupies the third position amongst the 6 Indian companies
who have made it to the list. Further, the BPC brand continues to occupy its pre-eminent
position in the market and the London based brand valuation firm, Brand Finance has placed it
in the 7th position amongst India's 50 Most Valuable Brands. BPC continues to be amongst the
companies featured in the latest rankings of Platts Top 250 Global Energy Companies

Report card

How hot is this stock?

Price*
Volume*
MF holdings
Sales
Net profit margin
*
Computed on last 15 days' trading figures.
Report card

PE ratio 8.02 17/04/08

EPS (Rs) 49.94 Mar, 07
Sales (Rs crore) 31,840.20 Dec, 07
Face Value (Rs) 10
Net profit margin (%) 1.85 Mar, 07
Last bonus 1:1 28/09/00
Last dividend (%) 100 24/05/07
Return on average equity 17.57 Mar, 07

PRICE OF FUFLS

AUTOMOTIVE FUELS 17-Feb-2007

Selling
Select Product Mumbai Delhi Chennai Kolkata
Unit
Hi SPEED DIESEL LITRE 35.6 30.9 34 33.5
SPEED LITRE 49.9 44.5 49 48.4
SPEED 97 LITRE 60 55 60 NA

Services provide by BPCL

We provide a wide range of services to our valued Industrial customers. This range from
developing customized products, Technical seminars, Fuel Management Consultancy and Fuel
Management Systems, to Energy Audits and Terminal ling of Petroleum Products.

Customer advisory boards

Customer care

BPCL takes pride in assuming the role of “Fuel

Managers”, for major customers, by providing technical
know-how on storage, handling and conservation of
petroleum products. This is in addition to the usual
spectrum of services, viz. customized products, technical
seminars, fuel management systems, energy and safety audits and terminal ling of petroleum
products.

Interaction
With the objective of bringing industrial customers of diverse interests on a common platform
BPCL has established Customer Advisory Boards. The 18 meetings held by this board resulted
in a plethora of suggestions and also provided invaluable insights into customer needs and
expectations.

Energy Audits

BPCL carries out Audit on Energy Utilization and yield of fuel at specific requests. Interested
parties may contact:

Mr. K .Murali Mohan

Sr. Manager (Tech. Services) I & C
4&6 currimbhoy road, Ballard estate.
Mumbai 400001 Ph 2618281
muralimohan@bharatpetroleum.com

E - banking

BPCL has introduced a free of cost fund transfer for its customers. It is easy, safe and ensured
way of making payments operative 24 x 7 BPCL customers saves money, time and energy by
making use of this facility.

For further info - Contact

Chacko Varughese,
Mgr Marketing Svc I&C
4&6 currimbhoy road, Ballard estate.
Mumbai 400001 Ph 2618281
chackov@bharatpetroleum.in

Fuel Management System

Customer desirous of using Consultancy / Technical services offered by BPCL may contact
respective Area Managers and Territory Offices
Services offered.

Layout designs, explosives and other statutory approvals, Erection and installation of tanks,
usage and application of products, Product Testing, any other related matters.

For Integrated Power Plants, we also offer integrated fuel handling facilities on turnkey basis.
Our major clients include NTPC Kayankulam, Tanir Bhave - Barge based power plant and
many others.

Interested parties may contact respective Area Manager and Territory Officers.

Online ordering

Bharat petroleum B2B portal offers services to customers, which includes online order
booking, tracking of order, viewing statement of accounts and current balance. An important
feature on the site is the NOTICE BOARD, wherein important information relating to price
change is posted, improving response time with customers.

OBJECTIVES OF THE STUDY

• To find out the fuel consumption of the respondents.

• To assess the factors influencing to select the particular petroleum

corporation.

• To know the reason for increase the demand of diesel vehicles.

 SCOPE OF THE STUDY

As learning is a human activity and is as natural, as breathing. Despite of the fact that learning
is all pervasive in our lives, psychologists do not agree on how learning takes place. How
individuals learn is a matter of interest to marketers. They want to teach consumers in their
roles as their roles as consumers. They want consumers to learn about their products, product
attributes, potential consumers benefit, how to use, maintain or even dispose of the product and
new ways of behaving that will satisfy not only the consumer’s needs, but the marketer’s
objectives.
The scope of my study restricts itself to the analysis of preferences of consumers,

perception and consumption of petroleum bunks. The study is based on the petroleum

bunks (petrol & diesel) the scope of my study is also restricts itself to Ambala region only.
 RESEARCH METHODOLOGY

This chapter describes the methodology of the study. This project is based on information
collected from primary sources. After the detailed study, an attempt has been made to present
comprehensive analysis of consumption of Petroleum Bunks consumed by the people. The data
had been used to cover various aspects like consumption, consumer’s preference and
customer’s satisfaction regarding Petroleum Bunks.

Survey design:
The study is a cross sectional study because the data were collected at a single point of time.
For the purpose of present study a related sample of population was selected on the basis of
convenience.

Sample Size and Design:

A sample of 100 people was taken on the basis of convenience. The actual consumers were
contacted on the basis of random sampling.

Research Period:
Research work is only carried for 5 or 6 weeks.

Research Instrument:
This work is carried out through self-administered questionnaires. The questions included were
open ended and offered multiple choices.

Data Collection:
The data, which is collected for the purpose of study, is divided into 2 bases:
 Primary Source: The primary data comprises information survey of “Comparative
study of consumer behavior towards Nestle and Cadbury chocolates”. The data has
been collected directly from respondent with the help of structured questionnaires.
 Secondary Source: The secondary data was collected from internet, journals, news
paper & References from Library.
Table no:1

Which type of vehicle you own?

TWO WHEELER FOUR WHEELER

59 41
 Series1

4 wheeler 41

2 wheeler 59

0 10 20 30 40 50 60 70

2 wheeler 4 wheeler
Series1 59 41
No of conumers

According to the above analysis it is concluded that more consumers

have Two wheeler and less consumers have Four wheeler.

Table no:2

Which type of fuel you used in your vehicle?

PETROL DIESEL
57 43
 Petrol Diesel

Petrol, 57
60
Diesel, 43

40
No of
consumers
20

0
1
Petrol 57
Diesel 43

From the above analysis 57 consumers used petrol for their vehicle
& 43 are used diesel

Table no: 3

.In a weak, how many times you get filled up your vehicle
 Series1

More Than 3

32
Times

2-3 Times

43
1-2 Times

25
0 10 20 30 40 50
No of consumers

From the above analysis more consumers filled their vehicle 2-3 times
because their income level is good. And less consumers are filled their
vehicle 1-2 times in a weak.

Table no: 4

How much quantity you buy in a single visit.

1-2 Lts 2-5 Lts More than 5 Lts Depend upon

traveling
 25 33 25 17

Series2

35 33

30
25 25
No of consumers

25

20 17
15
10

0
1-2 Lts 2-5 Lts More Than 5 Depand Upon
Lts Traveling

According to the analysis 33 consumers buy fuel 2 to 5 lts and 25,25

consumers buy fuel 1-2 lts & more than 5 lts.

Table no: 5

Which corporation do you prefer for getting your vehicle/ vehicles?

 60 52

50

40
30
No of
30
consumers
18
20

10

0
HPCL BPCL IOCL
Series1 52 18 30

Most of the consumers preferred HPCL because of services offered by

the corporations and satisfaction level, less consumers preferred BPCL because
satisfaction of the Q & Q is less.

Table no:6

Why do you prefer this particular corporation?

 Series1

55
60

40
12 13 12
8
20

Services ofered

Convenience
Advertisments
Friends/Relativ

Quality/Trust
es

From the above analysis it concluded that most consumers preferred particular
Corporation because of convenience and 13 consumers preferred because
Of quality and trust.

Table no: 7

Are you satisfied with the quality & quantity of the fuel?
 No, 11, 11%

Yes
No

Yes, 89, 89%

YES NO
89 11

According to the above analysis it is concluded that 89 consumers are satisfied with
the Q & Q. and only 11 consumers are not satisfied with quality trust.

Table no:8

In your opinion which services should be offered by an

corporation?
 30 30
30

25

20
17
No of 15
15
consumers
10 8

Free Credit Availability Complaints

loyalty prog.
services facility of products handling
Series1 30 17 8 15 30

According to the most consumers, free services and complaints handling

Should be offered by an corporation.

Table no ; 9

Which attribute do you think is offered in best by the following

corporation?
 Services offered

BPCL
30%
HPCL
HPCL
48% IOCL
BPCL
IOCL
22%

most consumers thinks that services offered by HPCL is best and IOCL & BPCL
both not provided best services to their customers.

Quality/satisfaction

BPCL
22% HPCL
31% HPCL
IOCL
BPCL

IOCL
47%

In this graph quality and satisfaction is best provided by IOCL,.

 Product line/lube

BPCL
25% HPCL
37% HPCL
IOCL
BPCL
IOCL
38%

In this graph again IOCL provided best product line & lube and
Other corporations are not best for the
Product line and lube

Table no :10

In your opinion what is the underlying reason for increase in

demand of diesel vehicle?

Reasons Consumers
Power 05
Performance 16
Mileage 49
High cost of petrol 30
 Series1

power

5
Performance

16
Better mileage

49
with diesel

High cost of

30
petrol

0 10 20 30 40 50 60
No of consumers

According to the analysis it concluded that the underlying reason for

increase of diesel vehicle is better mileage with diesel and
high cost of petrol
 PREFERENCE ACCORDING TO AGE GROUPS

AGE GROUP TIME

1-2 times 2-5 times above 3 times ABOVE 40
15-20 12 24 5
20-30 37 8 5
30-40 2 1
ABOVE 40 2 1 1
Petroleum Corporation is introducing varieties of schemes to attract the people as well as to
fulfill the expectations of the people towards fuel consumption. it makes more competition
among the petroleum corporation to retain the consumers.

From the analysis it was found that the majority of the consumer prefer HPCL for filling the
fuel and the main important factor for select the petroleum corporation were nearness to their
place if petroleum corporations want to attract the consumer, they must provided required
facility at the outlets.
If the corporations wants to increase their sale then it provide attractive tools such as coupon
system/gifts, discount of regular consumers, lucky draw etc…
• Out of (100) respondents the majority of them fill 2-3 times in a weak and rest of them

fill 1-2 times of fuel in a weak.

• The majority of the respondents fill 1-2 litres of fuel in a visit in two wheeler and

majority of them fill more than 5 litres in a visit in four wheeler.

• In two-wheeler & four-wheeler of respondents didn’t expect any additional

facility/incentives from any corporations.

• Most of the respondents belongs to the age group of 20-30 years and they prefer HPCL.

• Out of the (100) respondents, the majorities of them are student in two-wheeler and in
four-wheeler among are doing business.

• National highway corporations must provide refreshment rooms and medical shop.
• Cleaning of vehicle must be provided for all the vehicles.

• Fast services will leads to consumers satisfaction.

 A STUDY ON THE PREFERENCE OF PETROLEUM BUNKS
AMONG THE CONSUMERS OF AUTOMOBILE USERS

QUESTIONNAIRE
NOTE:-
(1) Place a heavy “X” in the box, which best reflects your answer & mark only one opinion
for each statement.

Q 1. Which type of vehicle you own?

Two wheeler four wheeler both

Q 2 which type of fuel you used in your vehicle?

Petrol Diesel

Q 3.In a weak, how many times you get filled up your vehicle?
1-2 times 2-3 times
More than 3 times

Q 4.How much quantity you buy in a single visit?

1-2 Lts 2-5 Lts

More than 5 Lts Depend upon traveling

Q 5 .Which corporation do you prefer for getting your vehicle/ vehicles?

HPCL BPCL
IOCL

Q 6 Why do you prefer this particular corporation?.

(1) Recommended by friends/relatives

(2) Advertisement
(3) Quality/Trust
(4) Services offered
(5) Convenience
Q 7 Are you satisfied with the quality & quantity of the fuel?
Yes No

Q 8 In your opinion which services should be offered by an corporation?

(Rate on a scale of 1-5,5 being most important)

(a) Free services like:-Air, Water, and Toilet.

(b) Loyalty programmes.
(c) Credit facility / credit cards
(d) Availability of other lubricants
(e) Complaints handling /responsiveness

Q 9 Which attribute do you think is offered in best by the following corporation?

Corporations HPCL IOCL BPCL

Attributes
Services Offered

Quality/satisfaction

Product line/lube
Q 10 In your opinion what is the underlying reason for increase in demand of diesel
vehicle?

(a) High cost of petrol

(b) Better mileage with diesel
(c) Performance
(d) Power

Personal Information:
Name: - _________________

Age: - 15-20 [ ] 20-30 [ ] 30-40 [ ] Above 40 [ ]

Occupation: - Student [ ] self employed [ ] businessman [ ]

Monthly Income: - 5000-10000 [ ] 10000-20000 [ ] Above 20000 [ ]

Thanks For Your Co-operation

RIMT - IMCT
(Sandeep Gupta)

BIBLIOIGRAPHY

• C.R. Kothari, Research Methodology, Method and Techniques, Wilshaw Parkashan

New Delhi

• Rajan Saxena, Marketing Management.

• www.hpcl.com

• www.bpcl.com

• www.iocl.com