Date:15/08/2004 URL: http://www.thehindubusinessline.com/2004/08/15/stories/2004081501810200.htm

Back `IBP will maintain identity as IOC's marketing division'

Our Bureau

Kolkata , Aug. 14

AFTER its merger with Indian Oil Corporation Ltd (IOC), IBP Co Ltd will maintain its identity as the marketing division of the former, according to Dr N.G. Kannan, Managing Director of IBP Co Ltd and Director (Marketing) of IOC.

Addressing a news conference held here on Saturday to announce the launch of IBP's "Kisan Sabha'' initiative, Dr Kannan said the entire merger process would be over by December this year. Thereafter, the marketing divisions of both IBP and IOC would be put together to form a "professional and strategic marketing" entity that would take on competition effectively.

"We don't want to liquidate the brand equity of IBP and replace it with the IOC brand. Rather, we shall synergise efforts to minimise duplication and increase market share," he said, and added that a joint retail marketing strategy for the current fiscal had been drawn up. According to him, IBP would set up 501 new outlets - including 250 large-format ones - in the current fiscal. With this, the total number of IBP outlets would go up to 2,791. The outlay for all retail activities in the current fiscal, including setting up of new outlets and upgrading old ones, has been pegged at Rs 528 crore.

On its part, IOC has planned to set up 1,005 new retail outlets in 2004-05. Its overall outlay for retail activities has been pegged at Rs 1,300 crore this year.

Dr Kannan said IBP would continue with its cyrogenics and explosives businesses. Efforts were on to turnaround these businesses that were currently incurring losses. While the cyrogenics business would witness a turnaround this year, the explosives business would take another year to effect a turnaround.

He said that IBP had asked the Government for compensation for under-recoveries on account of selling products at a subsidy.

On the Kisan Sabha initiative, he said the company was holding the programme for its rural customers on August 15. The one-day event would be held at over 100 retail outlets in rural markets across the country. The event would revolve around educating farmers on their daily requirements. This would include education on rural banking, financial services, crop insurance, maintenance of farm equipment such as tractors and pump sets, tips on seeds and fertilisers, and health check-up for cattle. Experts from different areas have been roped in for the purpose. As part of its marketing strategy, such Kisan Sabhas would henceforth be held on days of national importance regularly, Dr Kannan said.