ONGC- Oil and Natural Gas Corporation Limited is the Indian based multinational gas and oil Company, whose headquarter is located in Dehradun, India. As the one of a leading Corporation, it has now relocated its registered office in the major city of India, i.e. New Delhi. It is the PSU- Public Sector Undertaking of Indian Government, under the administrative domain of Ministry of the Petroleum and the Natural Gas. In the sector of gas and oil production and exploration, it is the biggest company of India. About 70% of the crude oil in India is produced by ONGC, which is equivalent to the 30% of the total demand of the country, and about 62% of the natural gas it produces. The on-going upstream production and exploratory efforts of ONGC are the most important segment of the primary E&P business activities in India along with the responsibilities of accreting and finding the gas and oil reserves (ONGC, 2018). It is necessary for the company to carry out the analysis and evaluation, in order to be more profitable and able to generate more oil and gas to meet the consumer demand. BCG matrix will help the company in deciding the investment purpose, and allocation of resources. Here is the detailed BCG analysis of the ONGC;
Cash Cows
These items are responsible for the prime revenue generation of the company because of the high market share and low market growth rate. High market share reflects to high volume of sales, and low market growth means low consumption of cash for the milking purpose. The products must be maintained to lead the market. Natural Gas is the cash cow for the company, as it serves highest in this category to the consumers (Chopda, 2013)
Stars
These are the products which have high market share, which means they have high volume of sales, but high market growth which also reflects to the high consumption of cash for the investment purpose. The company must focus on the implementation of the effective strategies for turning the star into cash cow. Crude oil is the star product for the ONGC, as it explore and produce 70% of it, which covers overall 30% of the consumer demand. As being the public sector company, it needs to work hard to maintain the lading position and increase the percentage for serving the consumers (Singh, 2009).
Question Marks
The items have the high market growth and has the potential to grow more in future in terms of market share, as these items have low market share. The market share needs to be increase by the help of heavy investment and some effective strategies, or else this will be the dog item for the company. Motor Spirit is the question mark item for the ONGC, because of multiple competitors in the market. The quality of the service and products needs to be improved. It is necessary for the company to invest in this to make it profitable and reduce the burden (Chopda, 2013).
Dogs
These items have the low market growth rate and low market share, which means they consume much more than any other, and become the burden on the company. They have to shut down if the conditions worsen and the investment can be used somewhere else. Kerosene/ AIF is the dog item for the ONGC, as it consumes much cash of the government, but generate very less. The company needs to focus to this area, to make it star item, or else the consumption of cash will make it negative for the company (Singh, 2009).
References
Chopda, P. 2013. ONGC. [Online], Available at: https://www.slideshare.net/pranjalchopda/ongc-17065459, [Accessed on: 8th September, 2018].
ONGC, 2018. About US. [Online], Available at: https://www.ongcindia.com/wps/wcm/connect/en/home/, [Accessed on: 8th September, 2018].
Singh, R. 2009. ONGC. [Online], Available at: https://www.slideshare.net/ruchisingh123/g3-group08-06-ver11pptx, [Accessed on: 8th September, 2018].
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