INDUSTRIAL ANALYSIS
ATULYA SACHAR
MIDHILA ER
MOKSHA SHAH
SIDHARTH KUMAR
SONALI HOODA
VIGNESH S
VAISHWI SINHA
OIL AND GAS
UPSTREAM
INTRODUCTION
5.6%
82%
First Oil
Deposits
discovered,
1889
18%
.92%
CONSUMPTION
PETROLEUM CONSUMPTION NATURAL GAS CONSUMPTION
8%
21%
14%
44%
48%
15%
35%
15%
HIGH SPEED DIESEL OIL PETROLEUM COKE PETROLEUM LPG
NAPTHA FERTILIZER POWER DOMESTIC FUEL
PRODUCTION
• 82% FROM IMPORTS.
• 4TH LARGEST IMPORTER OF OIL IN THE WORLD.
• 18% DOMESTIC PRODUCTION.
• BRING IMPORTS DOWN TO 67% BY 2022.
NATURE OF MARKET
The current state of gas
market in India can be best
THE TWO MAJOR
described as controlled,
largely by government, with
PLAYER
OLIGOPOLISTIC
ONGC- OIL AND NATURAL GAS
characteristics (few large
COPORATION LIMITED
players control the market)
with interventions from the
government across the gas
chain. OIL-OIL INDIA LIMITED
MARKET PLAYERS
GLOBAL INTEGRATION
• Saudi Arabia-$36.6bn
• Iraq-$45.74bn
INDIAN MARKET PLAYERS • Iran-$22.59bn
• IOCL • Nigeria-$18.11bn
• OIL • UAE-$14.29bn
• ONGC • Venezuela-$18.34bn
• GAIL • Kuwait-$2.7bn
• Reliance Petroleum • Qatar-$1.7bn
• Tata Petro dyne • Malaysia-$1.7bn
• Essar Oil Limited • Angola-$1.7bn
• Cairn India • Mexico-$1.5bn
• Brazil-973.8mn
• Egypt-$620.7mn
WHY 85-90% COMPANIES ARE NATIONALISED?
COMPETITIVE ADVANTAGE
CAPABILITIE POSITION
RESOURCES
S EFFECTS
• ASSETS • PRODUCTIVIE • FIRM’S
CONTROLLED ACTIVITIES OF MARKET
BY THE FIRM THE FIRM POSITION
POSITION EFFECT
• CAPITAL NEEDED
NEW • COST ADVANTAGE
ENTRANTS • DISTRIBUTION CHANNEL
• PRODUCT DIFFERENTIATION
COMPETITORS • CAPACITY
• TECHNOLOGY/R&D
• CHANGING NEEDS
SUBSTITUTES • PRICE AND PERFORMANCE
• SWITCHING COST
RESOURCES
TANGIBLE INTANGIBLE
• PHYSICAL INTELLECTUA
L
FINANCIAL HUMAN
CAPABILITIES
EFFICIENCY
INNOVATION
FLEXIBILITY
Trends and Innovation
Rise of new hydrocarbon sources
Digital transformation initiative:
Big Data Analytics
Industrial Internet of Things(IIoT)
Growth
Expansion
Diversification
Investment to increase production
More focus on small companies
Focus on city gas network
Manufacturing and Technology
[Link]
Exploring Seismic Ship
Extraction Semi-Submersible platform
Product storage and Transport Floating production storage and
offloading
Marketing Mix
Price Crude Oil Prices ($/Barrel)
Product
Exploration and production of crude oil and natural gas
Oil-field services and production related to value-added products like
power, petrochemicals, naphtha, liquefied petroleum gas and
alternate and unconventional energy sources
Crude oil reserves Natural gas reserves
Region Share of oil (%) Share of gas (%)
(in million metric tonnes) (in BCM)
Arunachal Pradesh 1.52 0.25 0.93 0.07
Andhra Pradesh 8.15 1.35 48.31 3.75
Assam 159.96 26.48 158.57 12.29
Coal Bed Methane 0 0 106.58 8.26
Eastern Offshore[a] 40.67 6.73 507.76 39.37
Gujarat 118.61 19.63 62.28 4.83
Nagaland 2.38 0.39 0.09 0.01
Rajasthan 24.55 4.06 34.86 2.70
Tamil Nadu 9.00 1.49 31.98 2.48
Tripura 0.07 0.01 36.10 2.80
Western Offshore[b] 239.20 39.60 302.35 23.44
Total 604.10 100 1,289.81 100
STP Analysis
Segmentation
Customer Product
Segmentatio Segmentatio
n n
National Oil
Crude Oil
Companies
Internation
al Oil Natural Gas
Companies
Industry Segmentation
Exploration services involve use of seismic methods to evaluate where and how to prove a
drilling prospect, high-speed computers and advanced, 3D, visual interpretation theaters.
Drilling services include well design, drilling rig operation and process, and related
technologies. Other services include formation evaluation, logging, and measurement while
drilling (MWD).
Well completion involves bringing the production on line with advanced downhole equipment
applications, downhole monitoring and automated well control equipment.
Production services involve application of various physical and chemical processes to increase
the amount of oil or gas that can be extracted from a field, and removing contaminates to get
ready for sale.
Offshore construction contractors provide design and construction of platforms, drilling rigs and
sub-surface well completion equipment.
Targeting
Product differentiation
Service differentiation
Positioning
Branding
Differentiation
PESTEL ANALYSIS
P-Political
E-Economic
S-Social
T-Technological
E-Environment
L-Legal
Political factors
Policy made by OPEC Nations
After massive collapse in Venezuela, its cash-strapped government would
allow domestic gasoline prices to rise to the international market level.
US sanctions Impact: Iran Offers Oil to India at Cheapest Rate in 14 Years
Economic factors
Depreciating currency: India’s crude oil import bill is likely to jump by about
$26 billion in 2018-19 as rupee dropping to a record low
Social factors:
Ever-increasing number of private vehicles: India’s fuel demand grew 7.36percent to
robust growth in two-wheeler sales
Increasing awareness on environment friendly fuels
Technological factors:
New software and analytics for insights
End-to-end Exploration and Production (E&P) solutions - to increase efficiency, reduce
costs and improve return on investment
Developing technology and techniques
Integrating digital applications
Threat of electric cars
Environmental factors:
Wastewaters, gas emissions, solid waste and aerosols generated during drilling, production,
refining and transportation
Biodiversity loss
Oil and gas upstream industry in India requires prior environmental clearance before any
drilling activities.
Legal factors:
Oilfields (Regulation and Development) Act, 1948- regulates the licensing and the leasing of
petroleum and gas blocks
Petroleum and Natural Gas Rules, 1959- provides matters such as, where and by whom
applications for mining leases may be made, the terms upon which such licenses are granted,
the maximum area and time frame for leases, etc.
Government has enacted various policies such as the New Exploration Licensing Policy (NELP) &
Coal Bed Methane (CBM) policy to encourage investments
Ratio Analysis
Current Ratio = Current Assets / Current Liabilities
16.00
14.00
12.00
10.00
8.00
6.00
4.00
2.00
-
For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st
March, 2012 March, 2013 March, 2014 March, 2015 March, 2016
BPRL CAIRN ESSAR Oil GAIL HOECL OIL ONGC
Current Assets to Total Assets = Current Assets / Total Assets
1.20
1.00
0.80
0.60
0.40
0.20
-
For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st
March, 2012 March, 2013 March, 2014 March, 2015 March, 2016
BPRL CAIRN ESSAR Oil GAIL HOECL OIL ONGC
Ratio Analysis
Profitability Ratio = Net Profit After Tax / Total Revenue
200%
100%
0%
For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st
March, 2012 March, 2013 March, 2014 March, 2015 March, 2016
-100%
-200%
-300%
-400%
BPRL CAIRN ESSAR Oil GAIL HOECL OIL ONGC
Sales to Asset Ratio = Total Revenue / Total Assets
60.00
50.00
40.00
30.00
20.00
10.00
-
For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st
March, 2012 March, 2013 March, 2014 March, 2015 March, 2016
BPRL CAIRN ESSAR Oil GAIL HOECL OIL ONGC
Ratio Analysis
Working Capital = Current Assets - Current Liabilities
25,000.00
20,000.00
15,000.00
10,000.00
5,000.00
-
For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st
(5,000.00) March, 2012 March, 2013 March, 2014 March, 2015 March, 2016
(10,000.00)
(15,000.00)
BPRL CAIRN ESSAR Oil GAIL HOECL OIL ONGC
Debt Equity Ratio = Long Term Borrowings / Total Equity
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
-
For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st For the year ended 31st
(1.00) March, 2012 March, 2013 March, 2014 March, 2015 March, 2016
(2.00)
BPRL CAIRN ESSAR Oil GAIL HOECL OIL ONGC
Profitability over the years
Profitability OIL BPRL GAIL CAIRN ESSAR OIL ONGC HOECL
For the year ended 31st March, 2012 30.56%NA 8.89% 17.66% -2.19%NA 11.96%
For the year ended 31st March, 2013 31.27%NA 8.33% 146.00% -1.32% 34.42% -373.00%
For the year ended 31st March, 2014 26.58%NA 7.49% 63.02% 0.13% 43.35% -178.42%
For the year ended 31st March, 2015 22.78% -28669.47% 4.61% 14.91% 1.81% 30.02% -2547.94%
For the year ended 31st March, 2016 21.04% -341.62% 4.36% 15.10%NA 27.60% -10.29%
