BOC INDIA
Group 3
FRANKLINE PJ 20230130119
JAPLIN KAUR ARORA 20230405013
MADHWARAJ ACHARYA 20230405016
SWATHI P 20230405044
TANYA DWIVEDI 20230405045
INDIAN INDUSTRIAL GASES MARKET
The industrial gases industry in India is capital-intensive, serving diverse sectors like steel (50% of demand),
automotive, pharmaceuticals, and shipbuilding. Companies like BOCI operate through Build-Own-Operate (BOO)
models to supply gases such as oxygen, nitrogen, and acetylene, alongside engineering services. However, the
market faces pressure from economic slowdowns, pricing competition from smaller regional players offering 25-30%
lower prices, and shifting preferences toward LPG over acetylene for metal fabrication. Despite challenges, long-
term growth remains promising with expansions by steel majors and rising demand from healthcare and
infrastructure sectors.
PESTLE ANALYSIS OF THE INDUSTRIAL GASES MARKET IN INDIA
Political Technological
Government projects (railways, shipbuilding) drive demand. 10,000 cylinders near obsolescence, requiring replacement.
PSU outlooks favor LPG over acetylene. LPG offers superior storage and pipeline safety features.
Infrastructure investments offer long-term growth. BOCI lags European multi-cylinder pallets technology.
Economic Legal
Steel accounts for 50% of gas consumption. Asbestos-based cylinders face compliance challenges.
Post-2011 slowdown affected demand; competition intensified. Strict gas storage and transport regulations impact costs.
Smaller firms offer 25-30% lower prices, squeezing margins. Demand grows for eco-friendly, asbestos-free alternatives.
Social Environmental
Shift to LPG due to lower cost and improved safety. Sustainability trends favor LPG over acetylene.
Acetylene used for precision cutting and thick plate preheating. Fragmented market with 316 AIIGMA members increases competition.
Niche customers prefer acetylene despite higher costs. Customers prefer cleaner energy solutions, forcing a market shift.
INDUSTRY ANALYSIS
COMPETITIVE STRENGTH
Shipbuilding/Shipbreaking:
High-precision cutting and welding for large
INDUSTRY ATTRACTIVENESS
Energy Infrastructure (Construction):
structures, where acetylene outperforms LPG.
Railways: Limited use in preheating and cutting thicker
High demand due to shipyard expansion and
Used for repair and maintenance, precision materials but can be substituted by LPG and
fabrication needs.
cutting for thick metal sections. fuel mixtures.
Moderate demand due to government The attractiveness is driven by infrastructure
Offshore Rigs/Platforms:
investment in rail infrastructure. projects but acetylene’s usage is limited.e.
Specialized flame welding, cutting, and
maintenance work. Acetylene’s safety and
cutting precision provide an edge.
Metal Fabrication & Finishing:
In high-quality fabrication processes,
Oil & Gas Refining:
Acetylene’s high cutting precision, speed, and
Construction (Large-Scale Projects): Specialized metal welding and cutting
efficiency are valuable for thick metal cutting,
Acetylene is used for cutting and welding of applications, but LPG and natural gas mixtures
preheating, and hardening.
structural components, but LPG is increasingly are more common for general tasks.
replacing it. Acetylene is occasionally used in niche areas.
Automotive Manufacturing:
Used for welding and cutting in some
processes, especially for thicker or harder
metals that require precision.
General Metal Workshops (Small Scale):
Heavy Engineering: Consumer Durables Manufacturing:
Minimal usage of acetylene as LPG and cheaper
Some demand for acetylene for precision Acetylene is rarely used due to cost concerns,
alternatives dominate the market.
cutting in high-end engineering processes, but but small niches may exist for specific
No significant growth expected in this
the market is shrinking as alternative gases fabrication tasks.
segment.
grow in popularity.
RECOMMENDATIONS BASED ON THE MATRIX High-Precision
Differentiation:
Focus on markets
where acetylene's
precision and
Shipbuilding Metal Fabrication Energy General Metal
Construction performance offer
Offshore Rigs Railways Oil & Gas Cons. Durables clear advantages,
reinforcing its
Focus on maintaining and Selective investments and Maintain a presence but reduce Maintain operations but Disinvest or avoid focusing on unique strengths.
growing market share in these protection of existing positions. focus. LPG is increasingly minimize additional these sectors. Given the Cost Control:
sectors. These industries These markets still offer replacing acetylene in these investments. These sectors minimal usage of acetylene in Prioritize efficiency
require precision and safety in opportunities, especially in areas, making it a less viable have limited demand for these areas and strong
cutting, where acetylene has an processes where acetylene's segment. Manufacturers should acetylene due to substitution by competition from cheaper
and cost
advantage over alternatives like precision is required. Acetylene emphasize acetylene's other gases. Manufacturers alternatives like LPG, management,
LPG. Manufacturers should manufacturers should aim to advantages in specialized should focus on niche manufacturers should consider selectively investing
invest in R&D to enhance improve operational efficiency, applications but not rely heavily applications where acetylene is reallocating resources to more in innovations that
product offerings and ensure ensure high product quality, on this market. still relevant but avoid attractive segments.
enhance
safety standards are met. and emphasize the benefits of aggressive expansion.
Further, partnerships with precision and safety over LPG in competitiveness.
shipyards and oil platforms can these niches. Divest from Low-
strengthen long-term contracts. Growth Areas:
Gradually exit
Strategy: Continue investing in Strategy: Focus on cost control, Strategy: Keep costs low and Sttrategy: Use a cost-efficiency Strategy: Gradually phase out
innovation and offer value- customer retention, and cater to specific project-based approach to serve existing investments and operations in markets where
added services (such as training tailored solutions to industries needs without heavy long-term contracts and maintain a steady these areas while exploring acetylene is being
programs on acetylene use for with specific needs, investment. supply while monitoring market ways to repurpose or reposition replaced by cheaper
precision work). changes. their offerings for more
alternatives,
attractive segments.
reallocating
resources to more
profitable segments.
STRATEGIC MARKETING OPTIONS
ANSOFF MATRIX
Existing Products New Products
Product Differentiation: Differentiate Fuel Mixtures Innovation: Invest in
acetylene as a superior solution for precision customized fuel mixtures tailored for
cutting in existing markets like shipbuilding, specific industry needs like construction,
railways, and heavy fabrication. metal fabrication, and energy.
Existing Strategies considering both
Promote Superior Quality: Emphasize
Markets Smart Cylinders and Predictive
immediate impact and longer-
acetylene’s quality and efficiency to retain
customers in existing industries. Maintenance: Offer gas monitoring term positioning
services and smart cylinders with sensors Promote Superior Quality: Emphasizing
Leverage Growing LPG Market: Target
for usage tracking, leak detection, and the quality and efficiency of acetylene
growth in the metal fabrication, shipbuilding,
predictive maintenance for existing to retain customers in existing
and energy sectors with competitive pricing
customers. industries like shipbuilding and
and service.
railways. This is a low-cost approach
focusing on marketing and customer
Expansion into High-Growth Regions Renewable Energy Sector: Diversify into retention.
Enhance distribution, customer service and renewable energy applications, such as Promote Greener Solutions: Market
offer value-added services in western and hydrogen for fuel cells, aligning with a focus eco-friendly aspects to appeal to the
southern India, where industrial gas demand on clean energy and the global shift toward industries focused on sustainability
New is booming, to capture market share and sustainability. and stricter regulations, with minimal
differentiate from competitors. Electronics and Pharmaceuticals: Entering new investment.
Markets
Promoting Greener Solutions: Position its high-value markets by offering specialty Expand in High-Growth Regions: Focus
products, such as acetylene or LPG, as gases for electronics and pharmaceuticals, on western and southern India by
environmentally superior by emphasizing leveraging India's growth in these sectors improving distribution and customer
cleaner technologies, such as asbestos-free to expand beyond traditional industrial service to capitalize on rising industrial
cylinders and low-emission gases. gases. gas demand
FIN.
