RIL's bulk diesel market share climbs to 4.9%

Reliance Industries said it had a 4.9% market share of the bulk high-speed diesel segment in the December quarter. RIL’s share in this segment in 2015-16 was 3.5%. 

RIL’s bulk high-speed diesel sales have seen healthy growth in the past few quarters. “Impressive growth of 25% was registered in the December quarter and over 50% in cumulative year-to-date sales,” the company said in a presentation to analysts on Monday.

What has worked for the company is its focus on newer segments. RIL won a contract in 2016-17 that involves 30 railway consumer depots to provide 11.6% of the diesel requirement of Indian Railways. RIL is now the second largest supplier of diesel to Indian Railways, according to the company’s presentation.

In addition, RIL also supplies diesel to state transport units in Pune. The focus on areas like fisheries and mining has also helped it increase market share, RIL said.

Analysts point out most of RIL’s sales growth in bulk diesel has been at the expense of state-owned oil companies. Indian Oil Corporation’s domestic sales fell to 19.7 million tonnes in the September quarter from 21.38 million tonnes in the preceding three months, said a report by Elara Capital. In an investor call, A K Sharma, director, finance, IOC, pointed out the fall was because of losses in tenders for the bulk consumer business. Public sector oil companies dominate the fuel business in India, with Indian Oil having a large presence in the bulk diesel segment.