Eleven years after Reliance Industries Ltd (RIL) began shutting its fuel retail outlets in India, it has now regained market share in petrol and diesel to pre-2006 levels.
RIL, which enjoyed an overall 12% market share in fuel retailing till 2006, saw this slip to less than 0.5% in 2014, by when it had shut most of its fuel retail outlets due to spiralling crude oil prices. RIL spent ₹5,000 crore in setting up 1,470 retail outlets between 2004 and 2006. In 2008, however, RIL started shutting down outlets, and later reopened some of them. In 2018-19, it reopened or added 59 stations, reaching 1,372 fuel retail outlets now.
Up until 2006, when RIL’s fuel sales were at their peak, the refiner had a market share of 14.3% in diesel and 7.2% in petrol. “With 1,372 outlets, we clocked the highest-ever exit volume at 5.6 million kilolitres in March 2019," said RIL in the presentation.
Today, petrol and diesel sales nationwide grew 9% and 3%, respectively, in 2018-19 from a year ago, RIL outperformed the industry with figures of 21% and 16%, respectively, the company said in a presentation to analysts after its quarterly earnings.
The oil-to-telecom conglomerate, along with its partner BP Plc, plans to jointly set up as many as 2,000 petrol pumps in India over the next few years. While Reliance holds a licence to set up 5,000 fuel retail outlets, BP has a licence to set up 3,500 fuel retail outlets in India.
Currently, RIL’s fuel retail outlets are largely concentrated in the western region. Its key competitors are state-owned oil marketing firms — IndianOil Corp. Ltd, Bharat Petroleum Corp. Ltd and Hindustan Petroleum Corp. Ltd—which together dominate over 90% of the fuel retailing market.