SAGAR (M.P.

)
2022-23
A PROJECT REPORT
On
PRODUCT PROFILE MARKET SURVEY OF

For the partial Fuillfilment for the degree of MBA

SUBMITTED TO SUBMITTED BY
DEVPRIYA CHOUHAN NEELAM SHRIVASTAVA
( Lecturer) MBA 1ST Year
Department of MBA Roll No.
Gyanver Institute of Management & Gyanver Institute of Management &

1
 Science, Sagar Science, Sagar

Preface

The Project work is field which uses tools and techniques to transfer
subjectivity in the environment into objectives, also the findings of the research,
when applied show results, which can be measured and evaluated so there is
feedback this is what makes it a dynamic activity.

This survey is an analytical study of a different facts of the product. The focus is

given on the Brand profile. This A PROJECT REPORT On PRODUCT

PROFILE MARKET SHARE OF HP INDIAN OIL ENGINE”, is
for the partial fulfillment of M.B.A.. The idea behind this project is to give
practical knowledge and to make them to face real life situation. The project survey
is commonly used for the collection from the respondents through questionnaire. In
this method statistical techniques have been used systematically. This project survey
is not only with my own efforts but also that of others.

NEELAM SHRIVASTAVA
M.B.A. (IST YEAR )

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 ACKNOWLEDGEMENT

I would like to whole hearty thank and express my sincere gratitude to MR.
MANISH JAIN Head of the Department of Busines Studies, GYANVEER
INSTITUTE OF MANAGEMENT & SCIENCE for suggesting me this problem and
for giving an insight in dealing with the subject

.I am highly obliged to DEVPRIYA CHOUHAN, and All Faculty member, for

guiding me in various aspects of this project like conducting field work and designing
questionnaire and suggesting me the Project Work and helping me in finalising the
Report. I express my gratitude to all the customers who very kindly discussed various
aspects of this study and provided useful suggestions for discussing various problems.

Lastly, I Must express my gratitude to all the elders of the family and citizen of
the city who blessed me in course of discussion. I also extend my sincere thanks to
my family and my friends for their encouragement and support.

NEELAM SHRIVASTAVA

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 CERTIFICATE

This to certify that NEELAM SHRIVASTAVA Student of M.B.A.

GYANVEER INSTITUTE OF MANAGEMENT & SCIENCE Has diligently

worked on the Report of the A PROJECT REPORT On PRODUCT

PROFILE MARKET SURVEY OF HP INDIAN OIL ENGINE”
He has done this Work under My Guidance and Supervision. This project work is
original and not submitted earlier for the award of any degree or associate ship of any
other University.
During this study he made meticulous efforts for its completion. I wish him all
the best in this sincere endeavors for a bright and successful future.

Signature of the Signature of the Signature of the

Supervisor Head of the Department Examiner

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 DECLARATION

I hereby declare that the REPORT work entitled A PROJECT

REPORT On PRODUCT PROFILE MARKET SHARE OF HP

INDIAN OIL ENGINE submitted to the GYANVEER INSTITUTE OF

MANAGEMENT & SCIENCE is a record of an original work done by me under

the guidance of MR. MANISH JAIN Lecturer & Faculty Member at

GYANVEER INSTITUTE OF MANAGEMENT & SCIENCE . I also ensure that

this work done by me is purely original and is my own creativity.

Date : NEELAM SHRIVASTAVA

Place :

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 1.3 COMPANY PROFILE

INTRODUCTION

Hindustan Petroleum Corporation Limited (HPCL) is a Government Company within the

meaning of Section 617 of the Companies Act 1956. The Registered Office of the
Corporation is at Petroleum House, 17 Jamshedji Tata Road, Churchgate, Mumbai 400020.
HPCL is an amalgamation of the erstwhile foreign oil companies ESSO and Caltex, which
were taken over by the Government of India in 1974 and 1976 respectively.

HPCL is a Central Public Sector Undertaking, with a subscribed capital of Rs. 339.33 Crores.
The President of India is presently holding 51.01 % of the paid share capital, the remaining
shares being held by various Financial Institutions, FIIs, Banks, Mutual Funds, NRIs and
general public including employees of the Corporation. The shares are listed on BSE / NSE
and are actively traded.

HPCL is one of the largest integrated Public Sector Undertaking, engaged in the business of
refining Crude Oil and marketing of various petroleum products like Petrol, Diesel, LPG,
Kersoene, Lube Oils, Asphalt, branded products like Power, Turbojet, naphtha, ATF
(Aviation Turbine Fuel) throughout India and at select foreign countries. Some of these
products are exported to other countries.

HPCL owns and operates two refineries situated at Mumbai and Visakhapatnam. HPCL has
focused on its business throughout India by segmenting its business outlook into Retail
(Petrol Pumps), LPG, Industries & Commercial (Bulk Fuels supplies to industries, ships),
Lubes, Aviation, Refineries etc, with support from the shared services like Finance,
Company Secretary, Human Resources, Public Relations, Legal etc.

HPCL has 7 Retail and 6 LPG  Zonal offices at major Cities, in addition to 90 Regional
Offices, 37 major Terminals / Installations / Tap Off Points and an elaborate Pan India

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Infrastructure network comprising Lube Blending Plants, Depots, LPG Bottling Plants, LPG
Import Facilities, Petrol Pumps, Compressed Natural Gas outlets, Auto LPG Pumps, HP Gas
LPG Distributors, Superior Kerosene Oil/ Light Diesel Oil Distributors, Lube Carrying and
Forwarding Agents, Aviations Service Facilities (ASF) etc.  

HISTORY

HPCL was incorporated in 1974 after the takeover and merger of Erstwhile Esso Standard
and Lube India Limited by the Esso (Aquisition of Undertakings in India) Act 1974. Caltex
Oil Refining (India)Ltd.- CORIL was taken over by Govt. of India. in 1976 and merged with
HPCL in 1978 by the CORIL-HPCL Amalgamation Order, 1978. Kosan Gas Company was
merged with HPCL in 1979 by the Kosangas Company Aquisition Act, 1979.

In 2003, following a petition by the Centre for Public Interest Litigation (CPIL), the Supreme
Court of India restrained the Central government from privatizing Hindustan Petroleum and
Bharat Petroleum without the approval of Parliament. As counsel for the CPIL, Rajinder
Sachar and Prashant Bhushan said that the only way to disinvest in the companies would be
to repeal or amend the Acts by which they were nationalized in the 1970s. As a result, the
government would need a majority in both houses to push through any privatization

HPCL has been steadily growing over the years. The refining capacity steadily increased
from 5.5 million metric tonnes in 1984/85 to 14.80 million metric tonnes (MMT) as of March
2013. On the financial front, the Net income form Sales/operations grew from IN 2687
crores in 1984-85 to IN 2,06,529 Crores in Financial year 2012-13. During Financial Year
2012-13, its net profit was IN 904 Crores.

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MANAGEMENT

HPCL is managed by a Board of Directors. The Board of Directors consists of a maximum of

15 Directors, incuding the Chairman & Managing Director. The Chairman and Managing
Director is the head of the Corporation. The Board comprises of  Wholetime Directors also
called Functional Directors – Director Marketing, Director Refineries, Director Human
Resources, Director Finance. In addition,  part time Directors representing Government of
India, through Ministry of Petroleum & Natural Gas, and part time Independent Directors,
also called Navratna Directors are on the Board. All these Directors are nominated by the
Government of India. The Board of Directors is assisted by Executive Directors, General
Managers and other Officers / employees in carrying out the day-to-day functions of the
Corporation

Nature of business

HPCL deals with the product and services like Refineries, Aviation, Bulkfuels and
specialities, International trade, LPG- Hp gas Lubes- Hp lubes, Retail, Exploration and
production, Joint ventures, Alternate energy. HPCL is concerned with refining and marketing
of petroleum products.

Powers and Duties of Officers & Workmen

The power and duties of the officers and workmen of the Corporation are derived mainly
from the provisions of the Company Act 1956, the Memorandum & Articles of Association
of the Corporation, and the various manuals specifying the area of operation of individuals,
basis the job description, terms and conditions of appointment, and the delegation of the
authorities as specified.

HPCL is a commercial organization and the officers and workmen are appointed to carry out
the business operations of the Corporation, in line with the objectives set forth in the
Memorandum of the Association of the Corporation and the cocreated vision statement.

8
While discharging the assigned duties, all employees are required to comply with the
applicable provisions of statutes and rules and regulations in force, including the manualised
instructions.

Decision Making Process

The apex level decision making authority is the Board of Directors of HPCL, except for
matters which, as per the Companies Act 1956 are to be decided by the shareholders in the
Annual General Body Meeting. The Board has constituted several sub committees, such as
Committee of Functional Directors (CFD), the Audit Committee, the Investment Committee,
the HR Committee, the Investor Grievance Committee, etc. The meetings of these
committees are convened on need basis and the minutes of these meetings are placed for
information of the Board. Majority of the members of the Committees except the CFD are
independent Non-Executive of Government nominated directors with the whole time
directors playing a facilitating role.

The Corporation has constituted an Executive Council comprising of C&MD, the Functional
Directors and the Business Unit Heads. This Council discusses important issues concerning
the organization, analyse the same and recommend the ‘way forward’ in respect of matters
discussed. The emphasis laid by this council is on team approach, mutual support of
functions and joint deliberations on issues which has enhanced further the decision making
process. It has thus facilitated an integrated thinking process and an aligned approach across
the Corporation for achieving the Corporate Vision.

Exercise of Authority:

The Corporation has well documented Limits of Authority Manual, Purchase Manual, Chart
of Accounts, etc, facilitating the decision making process at various levels within the
organization.

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Limits of Authority Manual:

Limits of Authority Manual lays down the authorities that can be exercised at various levels,
i.e. the Board, Committee of Functional Directors, the Executive Committee, the Contracts
Committee, the Bids Committee and also the senior individual positions, etc. for different
activities of the Corporation. The manual is divided into segments representing different
functions like Sales, Crude & Shipping, Capital Projects, Operations & Distribution, Finance,
HR etc., and provides for a decision making process through various committees as above,
represented by inter-functional groups including Finance. This ensures a transparent and
streamlined decision making process adhering to the laid down systems and procedures and
thereby leaving no room for arbitrariness.

The Committee of Functional Directors has delegated further powers to various sub-
committees within the organization, viz., Contracts Committee, Bids Committee, Credit
Committee etc.

Purchase Manual:

This manual lays down elaborate procedures to be followed while undertaking purchases and
in finalization of contracts. It lays down, inter alia, the purchasing authorities at various
levels, norms and process for procurement.

The norms set for discharge of functions

The entire organizational functioning is basis the down delegation of authority at appropriate
levels and measures to the individual officers. Several documented manualised instructions
have been developed and approved by the Board of Directors, for the discharge of functions
by the officers of the organization.

Further guidelines issued by the Government of India, through the applicable departments,
and Central Vigilance Commission, Central Information Commission from time to time are
also followed. The guidelines issued by SEBI, Central Vigilance Commission, Stock
Exchange listing agreements also aid in the discharge of the functions. Particulars of

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arrangement for consultation with the members of the public in relation to the formulation of
policy or implementation thereof:

HPCL is a commercial organisation engaged in the refining of crude oil and marketing of
finished products and allied products and does not have formal arrangement or committee
wherein public can attend to formulate policies in the area of activity of HPCL.

However, HPCL do have mechanism of collecting feedback from customers / public for
upgrading the service levels to improve the customer satisfaction.

Infrastructure

HPCL's infrastructure is at par with that of the best global corporations in the hydrocarbons
sector. For over a quarter century now, HPCL has been consistently breaking new grounds in
production and marketing.

Operations

HPCL operates two major refineries producing a wide variety of petroleum fuels &
specialties, one in Mumbai (West Coast) of 6.5 Million Metric Tonnes Per Annum
(MMTPA) capacity and the other in Vishakapatnam, (East Coast) with a capacity of 8.3
MMTPA. HPCL 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.
Another Refinery of 9 MMTPA, set up in Bathinda, Punjab by HMEL, a Joint Venture with
Mittal Energy Investments Pte.Ltd. HMEL has commenced commercial operations. HPCL
has signed a MOU with Government of Rajasthan for setting up a Refinery near Barmer in
Rajasthan.

HPCL also owns and operates the largest Lube Refinery in India producing Lube Base Oils
of international standards, with a capacity of 335 TMT. This Lube Refinery accounts for over
40% of India's total Lube Base Oil production. Presently HPCL produces over 300+ grades
of Lubes, Specialities and Greases.

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The marketing network of HPCL consists of 13 Zonal offices in major cities and 101
Regional office facilitated by a Supply & Distribution infrastructure comprising Terminals,
Aviation Service Facilities, LPG Bottling Plants, Lube filling plants, Inland Relay Depots,
Retail Outlets (Petrol Pumps) and LPG & Lube Distributorships. HPCL has state of art
information technology infrastructure to support its core business. The data center is located
at Hitech city in Hyderabad.

Joint Ventures

HPCL-Mittal Energy Ltd.(HMEL)

The refinery is designed to process Arab Heavy Crude with flexibility to process other
heavy / sour / acidic crudes. The configuration of the refinery includes primary units and
secondary process units viz. CDU/VDU, VGO-HDT, FCC, NCU/ISOM, HGU, DHDT, SRU,
DCU and Polypropylene manufacturing facilities. Other facilities include utilities such as
CPP, Steam generation, Effluent Treatment plant, product storage etc. Facilities include
refinery units, a pipeline from Mundra to Bathinda, crude oil receiving terminal, SPM and
jetty at Mundra port.

HPCL Biofuels Limited (HBL)

In line with Government’s policy for blending of Ethanol, a new wholly owned subsidiary
company HPCL Biofuels Limited (HBL) was incorporated on October 16, 2009 to produce
Ethanol for blending into Petrol. HBL has set up Ethanol plants for blending into petroleum
fuels, through installation of integrated Sugar plant (3500 TCPD capacity), Ethanol plant (60
KLPD capacity) & Co-Gen power plant (20 MW capacity), one each at Sugauli in East
Champaran District and Lauriya in West Champaran District of the State of Bihar.

CREDA-HPCL Biofuel Limited (CHBL)

CREDA-HPCL Biofuel Limited is a Subsidiary company of Hindustan Petroleum

Corporation Limited (‘HPCL’), with Chhattisgarh State Renewable Energy Development
Agency (‘CREDA’) for the plantation of jatropha in the State of Chhattisgarh. CHBL was

12
incorporated on 14th October 2008. Jatropha seeds are used for the production of bio-diesel
as viable renewable source of energy. The Company’s objective is to carry out jatropha
planatation on 15,000 hectares of land leased to HPCL by the Govt. of Chhattisgarh. HPCL
holds 74%, and CREDA holds 26% shareholding in CHBL.

Hindustan Colas (HINCOL)

Joint Venture promoted with M/s COLAS SA, France. Incorporated on July 17, 1995.
Manufactures International quality value-added bituminous products such as bitumen
emulsions & cutbacks and modified bitumen. The products of HINCOL are widely used by
agencies associated with road construction.

Prize Petroleum Company Limited

HPCL, in partnership with ICICI and HDFC, had formed this Joint Venture E & P Company
for participating in exploration and production of hydrocarbons. Prize Petroleum Company
Ltd (PPCL) was incorporated on October 28, 1998. PPCL is also providing consultancy
services related to E & P. It has since become a 100% subsidiary E&P unit of HPCL. 

South Asia LPG Co Pvt. Ltd. ( SALPG)

Joint Venture with Total Gas and Power India (a wholly owned subsidiary of Total of
France) with HPCL's equity participation of 50% was incorporated on November 16, 1999.

First of its kind in India, the underground SALPG Cavern facility for storing LPG was
commissioned in December, 2007 and formally inaugurated by the Minister of Petroleum &
Natural Gas on 14th January, 2008. Setup at the cost of Rs.333.30 crores,the Cavern Marine
Terminal has a 60,000 MT capacity underground LPG storage Cavern and associated
receiving & despatch facilities at Visakhapatnam. The SALPG Cavern is the largest LPG
storage facility in South Asia with the lowest point 192 M below the Mean Sea Level (MSL)
ranking among the deepest Caverns in the World. SALPG has obtained IMS certification
from DNV for ISO 9001, ISO 14001, and OHSAS 18001.

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Bhagyanagar Gas Limited (BGL)

Joint Venture with GAIL for distribution and marketing of environmental friendly fuels
(green fuels) viz. CNG and Auto LPG for use in the transportation, domestic, commercial
and industrial sectors, in the state of Andhra Pradesh. Incorporated on August 22, 2003.

Aavantika Gas Limited

Incorporated on June 07, 2006, is is a Joint Venture Company with GAIL for distribution and
marketing of environmental friendly fuels (green fuels) viz. CNG and Auto LPG for use in
the transportation, domestic, commercial and industrial sectors, in the State of Madhya
Pradesh.

Petronet India Limited (PIL)

Joint Venture formed in May 1997. PIL, with different oil companies, implement individual
pipeline projects-like Petronet MHB, through Special Purpose Vehicles (SPVs). Since oil
companies are now having pipelines independently, PIL has initiated action to disinvest its
equity holding in individual Joint Ventures.

Petronet MHB Limited (PMHBL)

Promoted (PMHBL) with Petronet India Limited (PIL) for the construction and operation of
Mangalore - Hassan - Bangalore product pipeline. Meets fuel transportation needs between
Mangalore, Hassan and Bangalore. Executed at a cost of Rs. 667 crores.

Mangalore Refineries and Petrochemicals Limited (MRPL)

Commissioned in March 1996 with a Refinery capacity of 3 MMTPA . HPCL and MRPL
have been exchanging intermediate process streams between their refineries to supplement
efforts to meet new environmental norms in respect of products like MS and HSD on
mutually agreed terms.

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Rajiv Gandhi Institute of Petroleum Technology (RGIPT)

The Rajiv Gandhi Institute of Petroleum Technology (RGIPT), an Institute of national

importance, was set up at Jais, Dist. Rae Bareli, Uttar Pradesh through an Act of Parliament.
RGIPT is co-promoted as an energy domain specific institute by six leading Oil Public Sector
Units (ONGC, IOCL, OIL, GAIL, BPCL and HPCL) in association with the Oil Industry
Development Board (OIDB). The Institute is empowered to award degrees in its own right.
The Institute associates with leading International Universities / Institutions specializing in
the domain of Petroleum Technology.

Sushrut Hospital and Research Centre

SUSHRUT HOSPITAL is an exclusive effort of the Chembur Hospital Project Trust - a joint
venture promoted by likeminded Organizations, both from the Public and Private Sectors.
Since its inception in 2000 Sushrut Hospital and Research Centre has an outstanding
reputation for providing the highest quality health care services at a reasonable cost. Sushrut
Hospital and Research Centre endeavors to provide medical treatment that is safe, ethical and
affordable.

It is a five storeyed Multi Speciality Hospital with a large basement and is strategically
located at Swastik Park in Chembur, Mumbai. The Hospital offers comprehensive medical
and surgical care by renowned doctors and experienced staff using state-of-the-art
technology. Sushrut also offers specialized care in Oncology, Nephrology, Trauma and
Burns.

1.5 PRODUCT PROFILE

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1. Petrol : Known as Motor Spirit (MS) in Oil Industry. HPCL markets the product
through its retail pumps spread all over India. Its principle consumers are regular
personal vehicle owners.

2. Diesel : Known as Heavy Stock Diesel (HSD) in Oil Industry. HPCL markets the
products through its retail pumps as well as terminals and depots. Its consumers are
not only regular auto owners but also transport agencies, industries etc.

3. Lubricants : Riding on its brand – HP Lubes, HPCL is the market leader in lubricant
and associated products. It commands over 30% of market share in this sector. The
popular brands of HP lubes are Laal Ghoda, Milcy, Thanda Raja, Koolgard, Racer4,
etc.

4. LPG : HPGAS, The HPCL brand of LPG is a popular brand across India for domestic
and industrial uses.

5. Aviation Turbine Fuel With major ASF(Air Service Facility) present in all major
airports of India. HPCL is a key player in this sector supplying ATF to major airlines.
It has an accomplishment of sorts to supply fuel to US Air Force.

2.1 OBJECTIVES OF THE STUDY

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Objectives of the study can be broadly classified into two. They are as follows:

 PRIMARY OBJECTIVE
 SECONDARY OBJECTIVE

Primary Objective:

 To study about the departments and its functions in Hindustan Petroleum Corporation
Ltd.

Secondary Objective:

 To understand how the key business processes are carried out in Hindustan Petroleum
Corporation Ltd.
 To familiarize with different departments in Hindustan Petroleum Corporation Ltd
(HPCL) and the functions and activities including documentation.
 To know about the duties and responsibilities of key personnel.
 To study about the overall performance of HPCL.
 To understand the growth and diversification strategies of HPCL.
 To understand the technology adoption in HPCL for various activities.
 To check out whether there is a need for introducing corrective measures in any of the
company strategies.
 To understand the performance measurements of the employees and various
employee welfare activities.
 To get practical experience regarding the HPCL’s functioning.
 To conduct a SWOT analysis of Hindustan Petroleum Corporation Ltd.

2.2 Scope of the Study

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 To get accustomed with the business environment of Hindustan Petroleum
Corporation Ltd.

 To understand the structure, function and process of various departments and the
interdependence.

 To experience the organizational culture and its real colours.

 To know the environmental issues regarding Hindustan Petroleum Corporation Ltd.

 To evaluate the real business situation and to know how HPCL cope with its
challenging situations.

 To know about the competing business Links.

 To familiarize with the innovative technologies adopted by the HPCL.

 To familiarize with the training measures given by HPCL to their employees.

 Overall practical experience about HPCL and the business world, would enable to
understand the real situation and help the studies easier.

 To understand the steps taken to increase the productivity in HPCL.

3. METHODOLOGY

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The methodology of research was to conduct a detailed study of an organization. The main
part of the study includes data collection. The major data collection tools of study were
interviews, searching the websites, reports and brochures that were provided from the
organisation.

1. METHODS OF DATA COLLECTION

 PRIMARY DATA
 SECONDARY DATA.

Primary Data

Primary Data are those data which are collected by the investigator for the first time. It is
fresh in nature and is specially designed to fulfill the requirement of the problem in hand.
For collecting Primary Data the following are conducted:

 Interviews
 Discussion with Department Heads and Managers
 Direct Observation

Secondary Data

As the name indicates, it is the data which is collected by the investigator for the second
priority. It needs less time, money and effort and it includes :

 Annual Reports
 Brochures and other quality manuals
 Website etc.

Major Fire Fighting Facilities:

 Sufficient capacity Fire Fighting Engines

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 Automatic Fire Fighting System - Quarzoid Bulb heat detection system for detection of
any fire and actuate for Auto fire fighting system and operating water sprinklers for
extinguish fire. Also push buttons Auto fire fighting system is provided.

 Sufficient water storage as required for 4 HRs fire fighting are provided.

 GAA Monitoring System to detect any leakage of LPG and giving alarm for Fire
fighting.

 Pressure Vessels are provided with over filling alarm system and actuate auto
shut off pumps/compressors system.

 Safety Equipment's/PPE's/Safe Clothes for safe working.

 Effective communications systems.

 Electrical tripping systems to trip off VCB/OCB/other electrical circuits in case of

any leakage/short circuit.

Supply Chain Management

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HPCL operates 2 major refineries producing a wide variety of petroleum fuels & specialties,
one in Mumbai (West Coast) of 6.5 Million Metric Tonnes Per Annum (MMTPA) capacity
and the other in Vishakapatnam, (East Coast) with a capacity of 8.3 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 15 MMTPA. In addition, HPCL has constructed
a 9 MMTPA refinery at Bathinda, in Punjab, with Mittal Energy Investments Pvt. Ltd.

HPCL also owns and operates the largest Lube Refinery in the India 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.

Promotional Activities

For the promotion of different petroleum products, company is providing loyalty cards to the
customers and dealers. With the help of dealers company started ATM centre and provided
stores at Petrol Pumps which will turn to profit.

Competitors

The main Competitors are :

 BPCL (Bharath Petroleum Corporation Ltd)
 IOCL (Indian Oil Corporation Ltd)
 RELIANCE PETROLEUM LTD.
 ESSAR OIL
 CALS REFINERIES LTD
 BONGAIGON REFINERY & PETROCHEMICALS LTD. (Merged)

Competition Strategy

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For all petroleum companies products are same. So competition would increase day by day.
HPCL competition strategies are :

 Show good attitude towards customers

 Value added service
 Customer oriented service
 Free air service
 Wind screen cleaning
 Attitudes towards consumers by delivery boys
 ATM Centres
 Providing drinking water to consumers

Hindustan Petroleum retail formats are mainly divided into three

 Urban - HP Express / HP Class / HP Apna

 Highway - HP Junction / HP Model / HP Highway
 Rural - HP Hamara

HP Express :- A good looking outlet with modern technology offering quick Fill and
Convenience to customers.
HP Class :- A clean outlet with some non-fuel Offering.

HP Apna :- A friendly low cost fuel outlet with Basic facilities.

HP Junction :- An outlet to refuel, refreshes and Relaxes for travelers and truckers.

HP Model :- A small format outlet to refuel and refresh for travelers and truckers.

HP Highway :- An outlet to refuel

HP Hamara :- A simple outlet with a small store.

Importance

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 o Finance Department has an impact on all activities of the firm.

o Financial Department aims to discharge the finance functions successfully.

o Financial Department’s main aim is to use business funds in such a way that the

earnings are maximized / Spending prudently.

o Financial Department is necessary to every type of organizations, irrespective of its

size, kind and nature.

o Financial Department is useful for all types of organisation where there is any use of

finance.

Objectives
The objective of Financial Management or goals of business finance is to maximize the
company’s economic welfare. There two steps for achieving this specific objectives are :
 PROFIT MAXIMISATION

Profit earning is the main aim of every economic activity. No business can survive without
earning profit. Profit also serves as a protection against the risks which cannot be measured.
Thus, profit maximization is considered as the main objective of the business.
 WEALTH MAXIMISATION

When the firm maximizes the stock holder’s wealth, the individual stock holder can use this
wealth to maximize his individual utility. This objective helps in increasing the value of
share in the market.
Accounting System Adopted
The Financial Statements are prepared under historical convension in accordance with
generally accepted Accounting Principles (GAAP), Accounting standard is issued by The
Institute of Chartered Accountants of India (ICAI) and the Provisions of the Companies Act,
1956. All Income and Expenditure having material bearing are recognised on accrual basis,
except where otherwise stated in Note to Accounts in Balance Sheet. Necessary estimations
and assumptions of income and expenditure are made during the reporting period and
difference between the actual and the estimates are recognised in the period in which the
23
results materialise. Now it has been integrated with the ERP (Enterprise Resource Planning)
System. The ERP System is J D Edwards.

Sources of Funds

 HPCL adopts the different sources of finance like:

 Short Term Loans
 Long Term Loans
 Share Capital
 Reserves and Surplus

Application of Funds
o The finance obtained through the different sources by Hindustan Petroleum
Corporation has been utilized mainly for the purchase of Crude Oil.
o For the completion of New Ventures, Expansion, Terminal, LPG Plants, Crosss
Country Product, Pipe Lines for transporting Petroleum products.
o Expansion of Existing Facilities, Maintenance and Repairs of Refinery / Depots.
o Employee Cost
o Other Raw material Cost.

Management of Receivables and Payables :

Receivables
 Sales – Cash and Carry.
 Credit purchases (Only Furnace Oil, Bitumen etc.)
 Credit against Bank Guarantee
 Letter of Credit

Payables

 Purchase of Crude Oil against Letter of Credit.

 Purchase Order - payable within 15 days or some other cases 30 days as per tender
terms.

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  Payment against Bill

Pricing System

Hindustan Petroleum Corporation Ltd follows the price system of Import Parity Pricing
System. Import Parity Pricing System is the sum total of Total Expense (Exchange rate of
Dollars, Freight, Insurance and all other related expenses) plus Refining Costs plus
Marketing Costs. The Import Parity Price is decided by the Ministry that is Petroleum
Planning and Analysis Cell. The Products which follow the Import Parity Price system are:

 Motor Spirit (MS)

 High Speed Diesel (HSD)
 Superior Kerosene Oil (SKO)
 Liquified Petroleum Gas (LPG)

Budgeting
The Finance Department in Hindustan Petroleum Corporation deals with three different kinds
of areas :
 Plan Project : Mainly deals with New Refinery Project/ Expansion of existing
Refinery.
 Non-Plan Project : Non Planned Projects less than Rs.100 crores.
 Marketing Expense Budget : Budgeting is done in connection with Expansion related to
Sales / Marketing, which has an yearly target. A Zero basis Budget system is maintained
by the department in order to avoid unnecessary expenses and hence loss to the
organization.
 Other Operations expansion such as Terminals / LPG Plants / Offices

Gross Profit

HPCL has Gross Sales of Rs.2,15,675.49 crores in 2012-2013 as against Rs.1,88,130.95

Crores in 2011-2012 and Profit after Tax of Rs.904.71 Crores as compared to Rs. 911.43
crores in 2011-2012.

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Dividend

After taking into account the financial results of the company during the year, have
recommended dividend of Rs.8.50 per share for the year 2012-2013 as against Rs.8.50 per
share paide for the year 2011-2012. The dividend for the year 2012-2013, including dividend
tax provision will absorb Rs.336.75 crores.

Performance of the Company

Turnover : 2,15,675.49
Total Expenditure : 2,06,472.45
Profit/Loss before tax : 1,474.56
Profit/Loss after tax : 904.71
Earnings per Share : 26.92

The Vigilance Department at the Corporate Office provides guidance, supervision and
control to all the Vigilance functionaries of the Corporation. Its major work area
comprises handling and investigation of complaints received from individuals, Ministry of

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Petroleum & Natural Gas, CVC, PMO, HPCL Management and other sources. View
HPCL's Whistle Blower Policy.
 
Preventive vigilance includes system studies, surprise inspections, joint surprise inspections,
regular surveillance/scrutiny of procurement and contract files, scrutiny of property returns of
employees, coordination with Central Bureau of Investigation (CBI), Central Vigilance
Commission (CVC), Chief Technical Examiner (CTE), Vigilance Wing of Ministry of
Petroleum & Natural Gas (MOP&NG).
 
The CVO provides advice to the Chairman and acts as a link between the Corporation and
outside agencies like MOP&NG, PMO, CBI, CVC, etc., on vigilance matters. The Vigilance
executives function under the direct control and overall guidance of CVO. The unit Vigilance
functionaries also provide assistance to the unit heads in respect of interpretation of CVC,
CTE instructions, standing instructions of CVO, and other norms of statutory bodies like
CBI, etc.
Functions
 Handling of Complaints - Verification of complaints. Forwarding the complaint of
administrative nature to concerned departments.
 Conducting test check/surprise checks.
 Collection of intelligence/source information.
 Reporting daily important development to the Head of organization.
 Intensive examination of Contracts/works on CTE Pattern
 According Vigilance clearance to SECL officials in respect of promotion, probation,
resignation, superannuation, foreign visit etc.
 Scrutiny of Annual Property Returns of Executives.
 Furnishing of different type of returns to CVC, CBI, MOC, CVOetc.

 Arranging co-ordination meeting with CBI and other agencies.

STRENGTH

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  Cost advantage

HPCL has provided opportunity to operate sweet shop / ATM Centres in their Petrol

Bunks in order to make more profit and cost effective.

 Effective communicatio

An Effective Communication System has been implemented throughout the

organization for the smooth functioning.

 High Research & Development

The Research and Development System adopted by HPCL is highly qualitative,

Experimental and expensive.

WEAKNESS

 Expensive Research & Development

The Research & Development Process is highly expensive, so purchases technology.

 Changes in Operations
Handling of types of crude mix leads to sub optimal changes in operations.

OPPORTUNITIES
 Acquisitions and mergers
The opportunity for Acquisitions and Mergers, help the organization to start new
business units.
 Emerging markets and expansion abroad
The emergence of market strategies and globalization leads to expanstion of new
business units to abroad.

THREAT

 Strong Competition

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 Like any other business concern HPCL also has to face the competitors in the same
industry.
 Fall in value of Currency
Fluctuations in the value of Indian Money against Dollars is one of the major threat
faced by HPCL, which leads to high in overall expenditure and hence the price of
petroleum products.
 External changes
The External Changes such as government, politics, taxes, etc also affects the
business adversely.
 Reduced availability of crude oil.
Sometimes the availability of Crude Oil is reduced because of Non-shipment from the
exporting countries.

6.1 FINDINGS

 HPCL is a Navaratna PSU oil company of the Government of India.

 HPCL is a Fortune Global 500 company as per the ranking of 2013 and was ranked at
position 260.

 HPCL was featured on the Forbes Global 2000 list for 2013 at position 1217.

 HPCL has given India a firm ground in oil sector with its world class standard of
Lube Base Oils.

 HPCL is one of the Top Ten Public Sector Enterprises who fall under the 'Excellent'
category.

 HPCL continually invests in innovative technologies to enhance the effectiveness of

employees and bring qualitative changes in service.

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  The company is very committed to the Environment and the society, this is reflected
in the number of CSR activities that the company has been engaging with.

 HPCL has successfully integrated Information Technology in its activities at different

levels. The Enterprise Resource Planning (ERP) system is operational on
J.D.Edwards across the Corporation.

 The marketing network of HPCL consists of 13 Zonal offices in major cities and 101
Regional office facilitated by a Supply & Distribution infrastructure.

 There are a lot of employee development and social welfare schemes.

6.2 SUGGESTIONS

 Appointing a young energetic front office staff will boost the first impression of the
outsiders and also towards the organisation.

 The land kept futile nearby the office area can be used properly by gardening or by
some other activities.

 As one of the Corporate Social Responsibility, Whether the hike in petroleum

Products is reduced, will be a great relief to the public as the hike affects value of all
other products in the market regarding transportation.

 Recruitment must be done without any delay of time.

 Maintenance of Plant must be done or regular basis.

 Reduce luxurious expenses inside the organisation in order to reduce cost.

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  Cost of production can be reduced by adopting most modern methods and modify
plants to become more efficient.

 It has to maintain and exploit the goodwill it has created over the past years.

LIMITATIONS OF THE STUDY

Through the course of study, I found that it is virtually impossible to identify the core
competence of an organization within a restricted time period. Since, the complex people
power is the principle instrument of an organization, many of the factors, which are relevant
for the study, could not be expressed fully. These are due to :

 Time Constraints :

Time was a major limiting factor as the managers were busy with their own routine work.
Within a restricted period of 30 days, it is not practicable to study about the entire
organisation.

 Chances of Bias :

The study conducted mainly on the basis of Primary Data obtained through the interviews
with managers amd therefore chances of personal bias can exist.

Other Factors:

 Secondary data given by the organization was outdated.

 The informations received from some Department were not sufficient.

 The study is mainly based on secondary data therefore errors are possible.

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  The detailed study on many units demands more time.

 Lack of co-operation from certain departments due to their work load.

6. CONCLUSION

HPCL is one of the best oil sector companies in India. It has good HR practices and has an
ideal work environment for the overall development of the employees. The company is not
only concerned with making profits but also it is a company that has a deep commitment to
the society and is involved in various socially useful activities.

The Internship Training in HPCL as Organisational Study has benefited me with so much of
confidence and awareness, so as to be capable of myself to work in a firm. The study gave
me an opportunity to experience and improve my practical knowledge besides my theoretical
knowledge about an organisation.

Websites

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 www.hpcl.co.in

 www.wikipedia.com

 www.Hindustanpetroleum.com

 www.mrpl.co.in

 www.hmel

 www.ibm.com

 www.hpaviation.in

 www.encyclopedia .com

 www.indiaprwire.com

 www.salpg.com

 www.hpclbiofuels.co.in

 www.hincol.in

 www.prizepetroleum.com

 www.bglgas.com

 www.aglonline.net

 www.mrpl.co.in

 Annual Report 2012-2013

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