United Arab Emirates-based GP Global said it plans to invest Rs 100 crore (Rs 1 billion or U.S. $14 million) to build a greenfield lubricant blending plant in western India.
The plant, to be set up in Saronda village of Valsad district in Gujarat state, will have production capacity of about 300,000 tons per year, Prashanth Achar, CEO of Mumbai-based GP Petroleums - which is part of GP Global - told Lube Report. The companys board approved the proposal to set up the plant and will roll out the project in the coming months after further review including a decision about how to fund the project, he added.
The new plant will produce lubricants, grease and white oil, GP said in a statement.
The new blending plant will be the Ipol-branded lube suppliers second in the country and will manufacture specialty products, in addition to automotive and industrial lubricants. GP operates a plant in Vasai near Mumbai, with an annual production capacity of 80,000 metric tons and a storage facility with 15,000 tons capacity.
The company, which is licensed to manufacture and market Spanish producer Repsols finished products in India, said the new plant may also blend Repsol-branded automotive products. The Mumbai-based firm didnt disclose when the plant will be commissioned.
Achar said the new facility will accelerate the companys growth strategy, which is based on increasing sales of automotive lubes in tier-two and -three towns and cities. We at GPPL are very bullish about the growth of the Indian lubricant industry and aim to be one of its fastest growing players, he added.
Indias estimated 2.5 million metric tons finished lubricants market is dominated by three national oil companies - Bharat Petroleum Corp. Ltd., Hindustan Petroleum Corp. Ltd. and Indian Oil Corp. Ltd. - as well as several private players, including Castrol India Ltd., Gulf Oil Lubricants India Ltd. and Tide Water Oil Co. (India) Ltd.
The new plant is part of our global growth strategy to produce and market 500 million liters of lubricants across the world through both organic and inorganic routes, said Sudip Shyam, global head for lubricants and base oils at GP Global Group. Shyam noted that India, the worlds third-largest lubricant market, is a very important market for GP Global, and the group is confident of securing a higher market share in both automotive and industrial segments in the coming years.
The company said it has partnerships with over 500 distributors across India and that it will further strengthen those partnerships in the next few years. GP sells industrial and automotive lubricants, process oils, transformer oils, greases and specialty oils in India and internationally. Its customers include Tractors and Farm Equipment Ltd., Force Motors, Mahindra & Mahindra, Crompton Greaves, Royal Enfield and Tata Steel, among others.