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Strengths in the SWOT Analysis of
ONGC
Brand Equity
ONGC has invested in building a strong brand portfolio and has ensured to create an environment that is conducive to the growth of the Indian economy. It has played a proactive role in India’s development process and has CSR programs that have worked on several under-developed regions of the country. It was also the winner of best employer award and has a reputable image in the Indian as well as foreign market.
Technology
ONCG ensures quality in its products through automation of activities which has also helped the company scale up and down its capabilities depending on the demand conditions. The company has set up EPINET which is alive E&P information network. ONGC also has 3D reality centers known as the “Third Eye” for real-time information transformation of offshore and onshore application. The
company has Memorandum of Collaboration (MOC)with seven IITs to undertake advanced R&D projects.
Focus on Sustainability
ONGC has ensured that it protects and cares for the environment and has an integrated Health, Safety & Environment (HSE) program has proactively managed the environment. The company aims to reduce the environmental impact it may cause due to activities like drilling, exploration, and production by investing in effective solid waste management, environmental monitoring and reporting, and environmental management systems. The company also has ONGC Natural Gas STAR Program to promote and effective implementation and reporting of profitable and voluntary methane emission mitigation activities.
Strong Dealer Community
ONGC has a strong dealer community by building a culture among the dealers and distributors by asking them not only to promote the company’s products but also invest in educating and training the sales team to explain and create the relationship with the customer and help them extract the maximum benefits out of the products.
Weaknesses in the SWOT Analysis
of ONGC
Competition
Tata Petrodyne which is a subsidiary company of the TATA brand is considered to be one of the leading Oil and Gas companies with a turnover of around $200 billion. Oil India Limited (OIL) is also considered to be the second highest
Increasing Fuel Prices
When the oil prices go up that means that the prices of the crude oil go up and for companies like ONGC which are upstream companies, crude oil is the final product and thus crude oil can be sold at higher prices. The government announced a 10% higher price for natural gas at $ 3.36 per million British thermal unit for 6 months this year that helped the company get significant profit which would help the company break even after the new gas price.
Research
The company established Gas Hydrate Research & Technology Center (GHRTC). This center contributes to Government of India’s plan to commercialize Gas Hydrates as an energy resource. This center by ONGC has been
successful in identifying the gas hydrate reserves in the deep sea of the coasts of India and fresh reserves are estimated to be 134 trillion cubic feet. Research activities conducted like this will help the company find better opportunities.
Threats in the SWOT Analysis of
ONGC
Government regulations
There are always threats on the profit of the company by the changing government regulations. There have been instances where the government has asked ONGC to help cut petrol and diesel prices. There are instances where it was reported that the government had asked the company to absorb the rise of crude prices at Rs 1 per liter. These regulations by the government directly affect the profits of ONGC.
Electric Vehicles
According to International Energy Agency, more efficient fuel technology and electric vehicles are expected to cut transportation demand for oil by 2040 but it is also said that the world will face a supply crunch without good investment in new production. The efficiency of EV and also ride sharing trends is said to reduce oil consumptions and the demand for oil will grow slower in the next decade.
Fluctuating crude oil prices
The depreciation of rupee even though in small amount is said to be adding to the rising cost of the oil. The international crude prices jumped 45% in terms of dollar and the spike was 49% in the rupee. The increment in oil prices
