LUBRIZOL - Building on success

Lubrizol India Limited (LIL) is a Public Sector enterprise of Ministry of Petroleum and Natural Gas. The company was incorporated in 1965 as a joint venture between Government of India and Lubrizol Corporation, USA (LZ). Lubrizol Corporation is the leading additive manufacturer in the world and currently LZ has dominant market share in the global market. Apart from Lubrizol Corporation, there are three other major additive manufacturers and marketers in the world namely Infinium (newly created venture between Exxon and shell chemicals, chevron chemicals and Ethyl Corporation.
LIL's paid up share capital is Rs. 19.2 crores and current sales turnover is about Rs. 400 crores. The company holds a dominant market share in domestic market. LIL has got two manufacturing units; one at Turbhe, New Mumbai and the other at Taloja. Both the manufacturing units of the company have got ISO 9002 accreditation in 1995 and Turbhe Unit got ISO 14001 accreditation in 1998. Company's current net worth is Rs. 200 crores (estimated). ILI earned all time high profit during 1998-99.
LIL shall stay focused as a dominant supplier of chemical Additives for petroleum fuels and lubricants and shall defend its current market share in Indian market. The company shall make rapid studies in the fast growing Asia Pacific region. ILI wishes to achieve this by integrating with Lubrizol corporation's regional infrastructure. The company also wishes to focus on its Research and Development capabilities by closer co-ordination with Lubrizol Corporation and its major customers.
LIL was enjoying virtually monopoly status in regard to supply of chemical Additives to Indian Lubricant manufacturers till 1991. Subsequently, Lubricants and Additives have been de-controlled and many new players have entered Indian market.Similarly, major original equipment manufacturers of both commercial vehicles and passenger cars have set up manufacturing/marketing network in India. There has been gradual reduction in import tariff thereby providing less and less protection against imports. From single Additive company country has got, all the major additive marketeers who set up manufacturing facilities or make their products available from countries like Singapore. This has resulted in fierce competition along with price war in market segments which LIL used to dominate in the past. The company has, therefore, taken several pro-active measures to deal with this changing scenario.
At present primary challenge of ILI is to retain its market share and to maintain its profitability by driving out costs and providing superior customer service to its 100 odd customers.
The company has taken few pro-active steps to maintain its market share, which are:

providing customer service at internationally acceptable standards. Progressive improvement in on time delivery and response time to customers.

Providing after sales service to the customers in the matter of :

product testing
Engine testing
Training

Adopt Total quality management (TQM) approach for improving reliability of products.
Drive out costs and make products available to customers to effectively complete and add value to customer's business.

These along with few commercial strategies have enabled the company to defend its market share by staying ahead of competition and maintain/improve profitability.
Lubrizol India Limited (LIL) operates in a high technology area. LIL has been receiving technology and technical services from Lubrizol Corporation, USA, world leaders in the Additive business.During the first 25 years of its operation, LIL enjoyed near monopoly. It showed impressive physical and financial performance. After the Lubricant sector was decontrolled,LIL has been operating in a totally competitive environment in the last 5 years. New players have entered the Indian market. LIL has taken pro-active steps to face challenges of competition and stay ahead. LIL's overall performance during post-liberalisation period has been more impressive.
To meet the emerging scenario, LIL

Have developed trusting relationship with its customers, introduced new products, continued to focus attention to customer satisfaction, on-time delivery and prompt resolution of customer complaints. LIL Continues to provide technical services, testing assistance and training inputs to customers.
Continues to work with the suppliers to develop cost effective source of raw materials, continue to deal with them in a transparent manner.
Continuously enhanced shareholders' value and improve shareholders' earnings year after year. Proposed dividend payment during 1997-98 @ 40% of equity capital is the highest.
Continues to value the contribution of the employees at all levels. Shall work towards empowering them. Human Resource development shall be the key word.
The company respect the needs of the community and have been taking efforts to preserve the environment. LIL is also concerned about rapid changes in environmental standards in the country and rapid development of alternate fuels which may bring down additive consumption in the country.
Shall continue to work closely with Lubrizol Corporation. LIL shall execute a new TTA so as secure state-of the art technologies so vital for company's growth. LIL shall also diversify in allied areas to utilize its core competencies.

LIL, thus, enters the next millenium with a sense of satisfaction for its achievements, with a vision for further growth. LIL is fully confident to fulfill the genuine aspirations of its principal stakeholders.