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Gulf Oil, a leading lubricant brand, is set to increase the intensity of competition in the automotive battery space dominated by the likes of Exide and Amara Raja as the Hinduja Group company seeks to grow its two-wheeler battery business aggressively.
What was started off as a pilot venture a few years ago has gained significant traction.
Sales volume
The company began importing and selling batteries under the brand name Gulf Pride specifically targeting the new generation of two-wheelers. It sold more than five lakh batteries in the Indian market in 2017-18 and its battery is marketed through 135 distributors and more than 9,000 retail outlets.
“The pilot initiative has grown into a ₹46-crore business now. We import very high-quality batteries from China. We have confirmed that the quality of our battery is really good. We have a happy set of customers and we want to make it better,” said Ravi Chawla, Managing Director, Gulf Oil Lubricants India.
The company is looking to double the battery business revenue every year, supported by the expansion of distribution and other initiatives.
Recently, the company appointed Indian cricketer Hardik Pandya as the face of its business.
Gulf Oil sees bright scope to take this business to the next level as it believes the battery industry will see a strong growth with the ever-increasing vehicle population and expected shift from unorganised to organised segment.
The company believes there is demand-supply mismatch in this segment in terms of quality batteries. It will invest towards correcting it and bolster its market share.
This segment could witness robust growth in the coming years, the company said in its latest annual report. According to a recent report of Motilal Oswal Securities, GST will drive consolidation in the replacement market of automotive and inverter batteries, leading to a strong growth of 16-17 per cent for the organised players.
Replacement market
The share of the unorganised segment in the replacement market has been gradually declining though it is still about 45 per cent.
Cost of doing business is expected to increase for non-compliant players, as the government’s focus shifts towards higher compliance. In the overall battery replacement market, the share of unorganised players is expected to reduce from about 45 per cent to about 27 per cent by 2021-22.
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