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Mon, 20 April 2015 04:06:13
India's Bharat Petroleum eyes wider Sri Lanka market share
25 Mar, 2008 12:20:09
By Charitha Fernando
Mar 25, 2008, (LBO) – India's Bharat Petroleum says it is looking for opportunities in Sri Lanka's aviation and retail fuel sectors after launching its 'MAK' brand lubricants partnering with a top auto dealer in the island.
"We hope that we will also be given an opportunity to enter the main product market which is the petrol and diesel trade," Bharat Petroleum marketing director S Radhakrishnan, told LBO.

"We are already here in a small way doing some bunkering and now lubricants."

Bharat Petroleum was one of the bidders for a third share in Sri Lanka's retail fuel market but the process was abandoned following a change in the country's economic policy after 2004, which ruled out privatization.

"Aviation, if we are given an opportunity, we would also like to start refueling in Colombo and other air ports," Radhakrishnan said

"We are waiting an opportunity from the government do that."

The aviation fuel market is a monopoly of state-run Ceylon Petroleum Corporation, which is also eyed by the Sri Lanka unit of Indian Oil Corporation, which already has a third share of the retail petroleum business in the island.

Lanka IOC has also asked to supply fuel at the planned second international airport in southern Weerawila.

Bharat launched its MAK branded lubricants in partnership with a unit of United Motors, a Colombo-listed firm which has the agency for Mitsubishi and has an island-wide motor spares dealer network.

Currently, the 6.5 billion rupee (60 million US dollar) Sri Lankan lubricant market is shared by over ten players following a government decision to liberalize the market.

Caltex Lanka Lubricants, a unit of Chevron Texaco and Lanka Indian Oil Corporation (LIOC), dominate the market with an estimated 20 percent share.

Foreign brands including Shell and BP play in the premium end, with Chevron and Lanka IOC running blending plants and having mass-market brands.

Bharat Petroleum says they hope to gain a 10 percent market share in three years time.

MAK lubricants would be distributed by TVS Lanka Ltd a joint venture between United Motors and India's TVS and Sons which was formed in 2003. The firm has 800 dealers island-wide.

Chevron Texaco sells through CPC dealerships, but CPC is also planning to re-enter the market.

United Motors is hoping that Bharat's 'MAK' lubricant products could break the market dominance of Caltex and Lanka Indian Oil Corporation.

"We are not going to be a small payer in the market here," Ranjith Fernando, Chairman, United Motors Lanka said.

"We have brought a good Asian product to capture a significant market share in the local market," he said.

Bharat Petroleum says it has a 22 percent market share in India.

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