Gulf Oil, based in Mumbai, sells a wide range of automotive and industrial lubricants and greases, and reported that net sales increased 23 percent year on year to Rs 283 crore during the quarter.

It is gratifying to see the all-around strong first quarter performance, which has been achieved due to the strategic brand, distribution and customer acquisition initiatives that the company has undertaken, Managing Director Ravi Chawla said in a statement.

Gulf Oils total sales volume was approximately 19,500 tons in the first quarter, up nearly 30 percent from 15,000 tons in the same period last year, Chawla said on a recent conference call with analysts and investors. This has been the highest volume growth we have achieved, he added.

Gulf said retail sales of its branded diesel engine oils, motorcycle oils and passenger car motor oils all recorded double-digit volume growth during the quarter due to the companys distribution expansion initiatives.

The company, a part of the Indian conglomerate Hinduja Group,said that its B2B businesses – including direct sales to original equipment manufacturers – also recorded double-digit growth. An institutional order also boosted volumes for the quarter, it noted. Gulf added an additional tractor manufacturer, Swaraj, to its OEM customer base during the quarter.

Its two-wheeler oil segment also posted a good start to the new financial year, riding on healthy volume growths and momentum from the previous year, Gulf Oil stated. The company forayed into the emerging segment of synthetic two-wheeler oils during the quarter by introducing its new sub-brand, Gulf Power Trac 4T, to target motorbikes with cylinder capacities larger than 180 cubic centimeters.

Gulf Oil stated that its four-wheeler engine oil category also delivered double-digit growth in the first quarter. The company had started the process of revamping its PCMO portfolio last year to have a complete range of products catering to various segments in the category. It also introduced Gulf Multi G+, an upgrade to its highest-selling product in the category (Multi G), with an aim to tap growing compressed natural gas use in passenger cars in large cities.

The company said that its diesel engine oil category posted healthy gains during the quarter due to strong growth in the commercial vehicle segment, which was led by OEM-related business.

With more than 300 distributors and sales in over 55,000 retail locations in India,Gulf said itwitnessed a 4 percent to 5 percent increase in the size of its distribution network during the quarter.

Gulf said construction work at its new blending plant in Chennai is progressing well and is expected to be completed by the second quarter of its fiscal year 2017-2018.

The company is investing about Rs 150 crore to build the 50,000 metric tons per year plant. It has already spent around Rs 40 crore on land and expects incremental cash outflow of Rs 110 crore over the next 15 to 18 months.

The cost benefit will be towards freight because 30 percent of our sales is in the southern part of India, said Chief Financial Officer Manish Kumar Gangwal. The company currently supplies to the southern market from its blending plant in Silvassa and the average freight comes to between Rs 4.50 and Rs 5 per liter, while supplying from its Chennai plant would cost around Rs 1 per liter, he added.

Gangwal said that the plant will also help the company reach OEMs in Chennai, which is Indias biggest auto hub.

Mumbai-based GP reported a standalone net profit of Rs 7.83 crore (Rs 78.3 million or U.S. $1.17 million) from April to June 2016, up from Rs 4.61 crore in the same period last year.

Other income surged to Rs 7.63 crore in the three months ended June 30, up from Rs 44.20 lakh, GP Petroleums said in a regulatory filing. The company, formerly known as Sah Petroleums, didnt specify the reason for rise in other income.

GP, which makes the Ipol brand of lubricants, said that net sales increased 42 percent to Rs 122.8 crore from Rs 86.5 crore a year earlier. GP recently launched the leading Spanish oil company Repsols lubricant business in India to target the worlds largest two-wheeler automotive market.

Total expenses increased nearly 48 percent year on year to Rs 115.36 crore.

The company, a subsidiary of the United Arab Emirates-based Gulf Petrochem Group, sells industrial and automotive lubricants, process oils, transformer oils, greases and other specialties in India and internationally. It has blending plants in Vasai and Daman in India, with total annual production capacity of 80,000 kiloliters.