By :L.K.S. Chauhan, Ch.Mgr.(Auto LPG)Indian Oil Corporation Ltd.Head Office, Mumbai

15th Feb, 2012Taj Mahal Hotel, New Delhi

WLPGA Regional Summit

Overview

Of

Indian 2-wheeler

Autogas Market

Auto LPG Growth : Infrastructure

 ‐

 200

 400

 600

 800

 1 000

 1 200

2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11

182 307 

536 

738 

920 1 042 

No. of Stations

No. of stations

Year 2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11

No. of Stations 182  307  536  738  920  1,042 

Auto LPG Growth : Sales

 ‐

 100,00

 200,00

 300,00

 400,00

2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11

89,58 

185,98 

282,35 

248,19 

341,31  351,03 

Sales (TMTs)

Sales (TMTs)

Year 2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11

Sales (TMTs) 89.58  185.98  282.35  248.19  341.31  351.03 

Industry: ALDS Infrastructure

IOC332

Essar Oil2

HPCL208

CleanFUEL4

RIL132

IPPL6

BPCL88

SHV20

Aegis 62

Vanaz22

Elf /Total LPG*27

Gas Energy22

Others137

Company 2011-12 (Upto Jan'12) Share %

IOCL 332 31HPCL 208 20RIL 132 12BPCL 88 8Aegis 62 6Total LPG 27 3Gas Energy 22 2Vanaz 22 2SHV 20 2IPPL 6 1CleanFUEL 4 0Essar Oil 2 0Others 137 13TOTAL 1062 100

Industry: Auto LPG Sale

IOC91028,00

Essar Oil119,24

HPCL48960,00

CleanFUEL332,03

BPCL44980,00

IPPL2379,00

RIL21928,00

Vanaz3133,55

Aegis 16132,00

SHV4528,54

Elf /Total LPG*14185,00

Gas Energy5397,00

Others37486,51 Company 2011-12 (Upto

Jan'12)-MT Share %

IOCL 91028 31HPCL 48960 17BPCL 44980 15RIL 21928 8Aegis 16132 6Total LPG 14185 5Gas Energy 5397 2SHV 4528 2Vanaz 3133 1IPPL 2379 1CleanFUEL 332 0Essar Oil 119 0Others 37486 13TOTAL 290588 100

“PROJECT GREENSTROKE”AN IAC INITIATIVE

Project Greenstroke

IAC

ALPG Mktg. Cos

ALPG Kit Manufacturers

ALPG Equipment

Manufacturers

ApprovalAgencies

Vehicle sales in India, 2010-11

Category 2010‐11 sales % share

Passenger Vehicles 25,20,421  16.25%

Commercial Vehicles 6,76,408  4.36%

Three Wheelers 5,26,022  3.39%

Two Wheelers 1,17,90,305  76.00%

Grand Total 1,55,13,156  100.00%

Vehicle sales in India

 ‐

 2 000 000

 4 000 000

 6 000 000

 8 000 000

 10 000 000

 12 000 000

 14 000 000

2004‐05 2005‐06 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11

No of veh

icles

Sales trend

Passenger Vehicles

Commercial Vehicles

Three Wheelers

Two Wheelers

Fastest growing segment : 2 wheelers

Reasons for 2 Wheeler Growth

• Growing working population• Increased access to credit and lower interest 

loans• Increased consumer embrace of financial 

products• Upward migration of household income 

levels• Fast paced urbanization to rise from 28% to 

40% by 2020• Middle class expanding by 30 – 40 million 

every year

2 W – Population in India, Mar 2011

No. of vehicles

Bikes

Scooters

Mopeds

Category No. of vehicles (cr) Share

Bikes 4.00 79.05%Scooters 0.76 15.02%Mopeds 0.30 5.93%

Total 5.06 100.00%

Total operating 2-wheelers : 5.06 Cr.

Vision

AutoLPG as the most preferred fuel for 2 wheelers consumers in India

Mission

Provide ALPG kits for 2 wheeler customers at affordable price fully backed by sales and service support, to make it attractive for conversion from petrol and with large no of such conversions, enthuse 2 wheeler OEMs to enter this segment in a big way

Vision / Mission of the Project

2-Wheeler survey

• Comparable mileage vis a vis Petrol.• Running range of 800‐1000 Km/pm• In dual fuel model almost all the respondents operated there 

bike on ALPG only, petrol was used only when ALPG was exhausted.

• Quite a few of the respondents owned more than 1 ALPG bike.

• Most of the respondents said there is lot of interest for ALPG bike.

• OEM’s ALPG Bike not available in the market.

Earlier scenario

• 2W kits cost > $ 190 per fitment• Un ergonomic  design and positioning of tank

• Negligible customer awareness– 2W ALPG kits were perceived to be unauthorized

• Inadequate service facilities• Numerous unapproved/ illegal kits in market

LPG kits with: 

Cost approx. $ 100 

Performance comparable to petrol

Convenient & aesthetically acceptable design

Comply with all safety/statutory norms

Network of ALPG dispensing stations

Warranty / After sales service support 

Customer Expectations

Right price of kit < $ 100 ??

Meeting demand for conversions

Development of RFCs, including training & certification

Marketing strategy, including customer awareness

Network expansion to meet additional demand

After sales service support

Business Challenges

Project Implementation

• Synergizing the strength of  OMC’s, Retrofitters, Equipment manufacturers, RFC & Statutory authorities for a concerted effort in 2W Segment.

• Generating profits through volumes instead of high price build up at various levels of value chain.

• Liasoning with related government agencies for expediting vehicle registration.

• Generating awareness among target consumers at all integrated fuels OMC’s network.

• Building customer confidence through uniform communication, product quality / prices and after sales service.

Role played by IAC & OMCs

• Development of kits in co‐ordination with Kit & equipment manufacturers 

• Expeditious Type approval from Agencies• Certification of 2W RFCs• Marketing Strategy • After sales service support

MISSION ACCOMPLISHED !!!

PRICE < $ 100

Sales Promotion

• Display and Demo of 2W ALPG at OMC RO’s• Demo bike offered by Local RFC was displayed at all 

Targetted IAC ALDS.• Display of bike at outlet along with a Kiosk.• Information to customer through SMS / Banners / 

Handouts / Posters / FM Jingles.• During demo campaign customers was explained 

benefits of ALPG and offered free test ride of the bike to get a feel of the performance.

• RFC then took orders from customers interested in conversion.

Sales Promotion

Sales Promotion

Sales Promotion

Sales Promotion

Sales Promotion

Sales Promotion

oALDS infrastructure  expansionoMaintaining price & qualityo Expansion of Kit Dealer Networko Expeditious RTO endorsement o Constant sales promotionso Market watch for  unauthorized kits 

Expansion & Sustainability of business

Total operating vehicles : 5.06 Cr.

Expected no of vehicles for conversion(> 1000 km/month : 50% of total) : 2.50 Cr.

Assuming only 10% conversion : 0.25 Cr.

Potential for retro-fitment : 25.0 Lacs

Additional Turnover : > ` 1000 Cr

Estimated ALPG consumption by this : 0.22 MMT p.a.segment.

Additional Turnover for OMC’s : > ` 1250 Cr

Benefit Statement

Thank You for your attention !!Thank You for your attention !!

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