OEMs are now looking for managing stricter emission norms—BS VI–which provides opportunity for lubricants with High performance base oils to be in use providing better fuel economy and robustness.

How do you see the growth of Indian oil and lubricants market? What are the challenges and opportunities?
During the period 2018-2023 global lubricants market is expected to grow by 2.18 per cent, whereas India will grow much faster than flobal average rate of 4.64 per cent. This reflects the potential growth in economy of India and we can relate same with GDP growth projections between 6 to 7 per cent in next few years. Both automotive vehicle growth and manufacturing sector growth will drive the lubricants volumes.

However, due to recent slowdown in economy these figures are constantly getting revised and potential to grow in a crowded market diminishes along with squeeze in margins. However most of the OEMs are now looking for managing stricter emission norms (BS VI standard staring from next financial year) which provides opportunity for lubricants with High performance base oils to be in use providing better fuel economy and robustness.

What are some of the trending products in the oil and lubrication segment and how is your company addressing these needs and demands of the market?
With introduction of BS VI emission norms from April next year, GS Caltex is already ready with its futuristic portfolio to meet the demands of the industry. We have already invested in developing our PAO based Kixx range (Kixx DX EURO 15W40– API SJ4) to meet future demands of the sector. Product categories meeting API CK4 and API FA4 standards are also ready for launch and will be in market as India moves to stricter emission norms towards BS VI.

Apart from same, we have expanded for Hydraulic Oil portfolio to launch Long Life Hydraulic Oil ( Kixx Hydro HVL ) as well as Zinc Free Hydraulic Oil ( Kixx Hydro AF ). We have also expanded our synthetic grease portfolio to focus on Hi Temperature Grease (Therma 2), Moly Grease ( Molytex 2 ) and Steering Grease ( Multifak EP2 )

What are the advantages of GS Caltex products compared to other players?
Nearly, every business in construction and mining sector is under increasing pressure to lower operating costs and increase efficiency. Meaning doing more with fewer people and using equipment for longer duration. This challenge has focused attention to lubrication and its role in equipment reliability and expense. We focus on all types of costs including – product cost, maintenance costs and administration costs, thereby reducing total cost of ownership for a client. Whenever engines and gearboxes run freer, operating costs are lower because they consume less fuel. And just 1 per cent lower fuel consumption means substantial fuel savings.

Premium lubricating oils can help increase equipment operating efficiency and engine fuel economy, and help contribute to reduced energy and resource use, lower emissions, and cost savings for industrial equipment and machinery, as well as passenger and commercial vehicle engines.

For example: GS Caltex Kixx Range Engine Oils high-performance synthetic engine oil that can help increase engine efficiency and improve engine fuel economy, compared with other engine oil grades most commonly used. GS Caltex Geartec branded synthetic driveline products can help to provide outstanding performance as well as to reduce mechanical energy losses. GS Hydro HD Series of hydraulic oils provides quantifiable increases in hydraulic equipment efficiencies and output, resulting in the potential for reduced energy consumption and operating costs.

What’s your outlook for capitalizing global market opportunities now?
As mentioned, OEMs are looking forward to move to High Performance Group II+ and Group III Base Oils . GS Caltex is one the major players in this segment with “ KixxLubo “ base oils being produced in our Yeusu refinery in South Korea and sold in more than 50 countries across globe . Though shift from conventional Group I Base Oils to Highly refined, Group II and Group III Base Oils have started long back in 1990s but now that has taken full throttle in last decade. Group I base oils simply cannot be used in most lubricants designed for modern passenger-car and diesel-truck applications. Those applications now generally require formulations using Group II or III base stocks. and there we are using our strength into action as leading manufacturer of High Performance Base Stocks.

Do you feel that the current tensions in the Middle East are an issue of concern? What impact will it have on the oil and lubricant industry?
Geo – political risks always exists in global market. However along with OPEC, countries like USA have now become net exporter of crude oil. Hence we do not see much impact on rising crude in medium to long term whereas there may be some impact in short term if the tensions continue for long. As base oils follow crude oil trend with few months’ lag, there could be some short term volatility in rise of Base Oil cost but not significantly. Also from demand side both China and India, major Asian economies failed to keep up their growth rate. Hence there is no significant rise expected going forward in Asia, however Oil and lubricant industry has always been volatile and can get impacted by more than one factor of political risk.

With the reduction in corporate tax, experts indicate a tax saving of 37,000 Crores for oil and gas sector, what is your opinion on this?
As lubricant industry is already competitive and walking on a tight rope, I don’t see much scope here in my personal opinion. Many companies may move on further investments on environmental friendly products or look for new opportunities.

Jayanta Ray , GM Industrial and OEM , GS Caltex India Pvt Ltd