HPCL in Rs 11,000 crore investment plan

Hindustan Petroleum Corporation Ltd has announced a Rs 11,000-crore (Rs 110 billion) investment plan over the next three years.

The investment will be in its new refinery in Punjab, upgradation of existing refineries for green fuels and clean fuels, expansion of its retail business and other infrastructure.

To counter the entry of new private players in oil retailing, HPCL will invest over Rs 2,100 crore (Rs 21 billion) in the oil marketing business, and another Rs 1,105 crore (Rs 11.05 billion) in retail automation.

The company will also push branded fuels for better margins, and will extend availability to 500 retail outlets.

It did not specify its exact strategy on expanding the number of retail outlets though, which currently stands at 4,800, less than Indian Oil Corporation's 9,000 outlets.

In a presentation to media about the company's future plans, C Ramulu, director (finance) said HPCL has set aside investments of around Rs 2,500 crore (Rs 25 billion) for the Bathinda refinery, Rs 1,152 crore (Rs Rs 11.52 billion) for green and environment friendly fuels and another Rs 1,635 crore (Rs 16.35 billion) for clean fuels.

HPCL will also put in Rs 320 crore (Rs 3.20 billion) for cylinder procurement, Rs 284 crore (Rs 2.84 billion) in LPG bottling facilities and Rs 400 crore (Rs 4 billion) into pipelines, Ramulu said.

Ramulu said that the company was marketing eco-friendly fuels and leveraging on the IT and communication technology using risk management tools.

The company is committed to investing Rs 1,900 crore (Rs Rs 19 billion) on environmental projects such as upgrading its refineries to Bharat II/III norms.

Ramulu said, "HPCL is eligible for Fortune 500, with the company ranking 490 in terms of net revenue. In 2002-03, the company's net revenue stood at $10,325 million."

He said HPCL has achieved highest growth in sales at 4.9 per cent as against the industry sales of 1.4 per cent.