Rapido-investor Shell deepens Indian lubricant market reach through Raj Petro acquisition
Shell
acquired 100 per cent stake in Mumbai-based
Raj Petro Specialities
to expand its market share and product portfolio in the lubricant sector.
This acquisition will deepen the company's foothold in the world's third biggest
lubricants
market in the world, a top company official said.
Shell, with a presence across 13 different office locations in India, runs business across verticals like lubricants, mobility, renewables, power, gas and aviation. The company also has investments in Rapido, Orb Energy, Freshbus, and Offgrid Energy
The company has already invested over USD 5 billion in India across the energy value chain, from
LNG import
terminals and fuel stations to renewable energy and technology centres, has acquired 100 per cent equity interest in
Raj Petro
Specialities Pvt Ltd from Germany's Brenntag Group.
"I think the acquisition of Raj Petro marks a very important and significant milestone for the lubricants business in the country. India is the third biggest lubricants market and from our strategic intent, India is one of the important growth markets.
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"So we have always been looking at ways by which we can serve more consumers with more products at the right price points," said Mansi Madan Tripathy, Chairman of Shell Group of Companies in India and Vice President - Lubricants Asia Pacific.
Without disclosing financial details of the transaction, she said the
acquisition of Raj Petro Specialities
by
Shell Lubricants
supports its plans to grow its portfolio and customer base in India, which is one of its key growth markets.
Raj Petro offers a wide range of products - from transformer oil to petroleum jellies, white oils, waxes and lubricants. It has manufacturing facilities at Chennai and Silvassa. The more than 80-year-old Mumbai-headquartered firm was acquired by Germany's Brenntag in 2017-18.
Running a lubricant oil blending plant at Taloja in Maharashtra, Shell plans to strengthen its 200-plus distributor network with the acquisition of Raj Petro. This move enables Shell to create more value by growing its lubricants portfolio and customer base in India.
"Raj Petro adds a new portfolio which is in growing sectors of pharmaceuticals, in personal care, power transmission and white oils which then adds on to our current portfolio to delight our customers in new ways," she said, adding it will help Shell realise new synergies and economies of scale across the lubricants value chain.
One of the four focus countries for Shell Lubricants' business growth strategy, India is the world's third-largest lubricants market in the world.
The firm serves close to 50,000 outlets through a network of 200 B2C and B2B distributors.
Shell already has long-standing partnerships with OEMs like Maruti Suzuki and Thermax. These forms help it co-create energy solutions. The partner firms include some of the world's top
automotive manufacturers
like Hyundai Motors, Mahindra Auto, Nissan Motor Corporation, BMW and industrial customers such as Volvo, John Deere, and Komatsu.
Shell is already expanding its portfolio with innovative solutions, including cooling fluids specifically designed for data centres.
"We also believe that because of the scale, we will also be able to derive synergies through the entire value chain. So from both the customer lens and operational efficiency lens, we do believe that it is going to add significant value for India's lubricants growth plans which is already on a very strong footing but it will take us to a new acceleration," Tripathy said.
She said Raj Petro brings with it a robust operational backbone with two manufacturing plants in Chennai (Tamil Nadu) and Silvassa (Union territory of Dadra and Nagar Haveli and Daman and Diu) with a total production capacity of 350,000 tonnes per annum along with R&D Centres.
Raj Petro not just strengthens local footprint but also brings international presence too. "They are also present in 100 countries globally. So we will have to find the best synergies from a portfolio perspective and then see what will be the footprint from an exact numbers perspective," she added.
Acquisition of Raj Petro by Shell unlocks powerful synergies across supply chain efficiency, product development and customer reach. Raj Petro has an already existing diverse portfolio including white oils, petroleum jelly, and speciality products. This will enhance Shell's offerings and enable cross-sectoral growth of the company.
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