GPPL plans to ink JV with Spanish giant

Lubricants major GP Petroleums (GPPL) has envisaged a novel ‘Make in India’ approach in a bid to increase market share in the country’s automotive lube space, and is planning a JV with Spanish lubricants giant Repsol.

The company, a subsidiary of UAE-based $3-billion Gulf Petrochemicals, began retailing Repsol’s products in India in April last year, and has a royalty agreement to use the latter’s brand name and technology in selling its products.

Talking to DH, GPPL CEO Hari Prakash M said, “Our flagship brand ‘Ipol’ has a big name in the industrial lubricants’ space, even as it is a mass market automotive brand. In terms of volume, our portfolio consists of 90% industrial lubricants, with the remaining 10% being automotive lubricants. Also, where auto lubricants are concerned, our market share is barely 1%.”

Accordingly, GPPL aims to increase its market share in the automotive space to 5% over 10 years, along with a sizeable mix of automotive lubricants at 40% of its total portfolio, along with a growing industrial share of 60%.

“Instead of pumping in more resources and technology into our own brand, we decided to connect with the best brands in the world. That’s where Repsol came into the picture,” Hari said.

Wanting to tap the growing auto market, Repsol tied up with GPPL last year. “We insisted that we’ll not buy and sell, but will ‘Make in India’. Repsol’s team audited our plant (in terms of R&D, equipment, and safety), and allowed us to produce its products, adhering to its high-quality formulations.”

GPPL’s plants at Vasai (near Mumbai) and Daman have a total capacity of 80,000 kl per year. Repsol’s range, which will be made at Vasai, may be produced to the tune of 1,000 litres in the first year, doubling in production based on demand in future.

Since six months, the company has doubled Repsol’s monthly sales run-rate at 150 kl. “Last year, we started with motorcycle oil in April, launching oils for (petrol and diesel) passenger cars in November, and diesel engine oils for commercial vehicles in December. This year, we have a complete package,” Hari said.

Tying up with a global brand has opened mammoth prospects of growth for GPPL. “It was last year that Repsol said that it’s eyeing a JV with GPPL. We also signed an agreement permitting us to sell their wares in neighbouring countries like Sri Lanka, Nepal, and Bhutan. Through the JV, they will put their full muscle power behind us in terms of technology, production, portfolio, and also getting in OEMs to work with us,” he said, not divulging further details.