Gulf Oil Lubricants India, the demerged lubricants business of Gulf Oil Corporation that was listed on BSE and NSE on Thursday, says it chose the “right time to unlock value”.

“The lubricants business has reached the ₹1,000-crore mark, achieved double digit growth, and is reporting healthy margins now. All the indications were there that this was the right time to unlock value, and let the company go on a separate fast-track journey,” said Sanjay Hinduja, Chairman, Gulf Oil International.

“With (the group’s) four main business operations – industrial explosives, lubricants, mining and infrastructure services— remaining within Gulf Oil Corporation, it was like a many-headed animal. We were not getting the right valuation,” he said referring to the group’s businesses prior to the demerger.

Besides, when you have different businesses within the same company, which are not synergistic with each other, it confuses the market. Analysts wonder if they have to track the lubes business, or the real estate business, Hinduja added. The aim is also to be a contender in the top three slots. “With the lubes business demerged, investors and analysts will now have to benchmark Gulf Oil along with the top three players here — Castrol, Tide Water and the newest Gulf,” added the Chairman.

Expansion The Hinduja Group company is also on track with its expansion project that entails setting up of a lubricants plant near Chennai. “For the second plant, construction will start this year in Chennai, where we are investing ₹120 crore. The existing capex is around ₹40 crore, at the Silvassa plant,” Hinduja said.

In Mumbai, to commence the day’s trading on BSE by striking the gong at the listing ceremony, Hinduja was accompanied by Ravi Chawla, MD, Gulf Oil Lubricants India. Chawla told BusinessLine That the listing will also bring more focus on the business, as well as resources. “With our strategies, we have become the fastest growing in this industry. Volume growth has been hardly 1 or 2 per cent, and was flat in the last two years, when we registered double-digit growth. We have gained market share in various segments that we are operating in.”

Post demerger, shareholders of Gulf Oil Corporation (GOCL) have been allotted one share in Gulf Oil Lubricants India for every two shares held in GOCL. Simultaneously, capital reduction and reorganisation in GOCL has been done by allotting one new GOCL share for every two old GOCL shares.

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