ONGC's Growth Strategy
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Case Code: BSTR130 Case Length: 12 Pages Period: 1999 - 2004 Pub Date: 2004 Teaching Note: Not Available |
Price: Rs.300 Organization: ONGC Industry: Oil and Energy Countries: India Themes: Corporate Restructuring |
Abstract Case Intro 1 Case Intro 2 Excerpts
Abstract
The case describes the growth strategy and diversification plans of the Government owned Oil and Natural Gas Corporation Limited (ONGC), the largest oil exploration and production (E&P) company in India. ONGC has near monopoly in India's oil E&P industry producing nearly 90 percent of the country's crude oil and natural gas. Till the late 1990s, the company was mainly confined to upstream activities of E&P. In order to reduce risks inherent in confining to one activity and to achieve financial stability and steady growth, ONGC acquired a major equity stake in Mangalore Refinery and Petrochemicals Limited so as to enter the down stream activities of refining. With this, ONGC became the first integrated oil company in India.
The case examines the benefits and drawbacks of oil E&P Company entering into refining and retailing businesses. The case also discusses the possible benefits and disadvantages of ONGC's plans in 2004 to enter insurance, power generation and shipping businesses as part of its diversification program.
Issues
The case is structured to achieve the following teaching objectives:
- Examine the growth strategy of a public sector oil exploration and production company
- Study the internal and external factors that contributed to the growth of ONGC
- Critically analyze the vertical integration strategy of ONGC by entering into refining and retailing businesses
- Examine the latest diversification plans of ONGC to enter insurance, power generation and shipping businesses and identify synergies, if any, with its core businesses
- Chalk out a future growth strategy for ONGC
- Gain insights into the oil and energy industry in India
Contents
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Introduction
Background Note
Vertical Integration
The Growth Plan
The Deregulation
Future Plans
Exhibits
Keywords
Case, Oil and Natural Gas Corporation of India, Indian Oil and Energy Industry, Business Restructuring, Diversification, Vertical Integration, Financial Restructuring, Deregulation of Indian Oil Industry
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