Topics: Sri Lanka, Petroleum, Tamil people Pages: 2 (506 words) Published: December 31, 2012
1. Identify the main resaons behind IOC’s expansion into global markets? A firm decides to enter the overseas markets because of the following reasons * Company objectives
* Market size
* Market growth
* Level of Risk and competition
* Government Regulations
Company Objectives
One of the company objectives read ‘To achieve higher growth through mergers, acquisitions, integration and diversification by harnessing new business opportunities in oil exploration & production, petrochemicals, natural gas and downstream opportunities overseas. ‘ Market Size & Growth

The Indian market was getting saturated and IOC needed to harness newer business opportunities. Its refining capacity is growing at CAGR 5.3%. The oil consumption of India is also the second fastest in terms of growth, and to cater to this huge market IOCL needed to enter the overseas markets and increase its capacity. 2. Evaluate IOC’s selection of entry modes for approaching the international markets?

Turnkey Projects
Indian Oil Trading Ltd, Mauritius is a wholly owned subsidiary of IOCL. It was acquired to construct a port oil terminal at Mer Rouge. IOT is built the port oil terminal, determined its functional and operational viability before transferring it to IOCL. It will also help IOCL market Servo Lubricants, help in bottling and distribution of Indane and LPG.

Strategic Alliance
For Aviation, Refueling and retail facilities, it has forged partnerships with Shell, Caltex and ESSO. IOCL has a turnover of Rs 841 Crore and is the 3rd largest petroleum company in Mauritius.
Joint Ventures
JV with Caltex to set up a bottling plant to sell LPG under the name ‘Mauri Gas’. It is a strategic move to get a share of the LPG market in Mauritius which is estimated to be close to Rs 1200 Crores.

3. In view of emerging economic and political scenario, Evaluate IOC’s entry into Sri Lanka as a wholly owned subsidiary?
IOCL has an wholly owned subsidiary...
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