ONGC inks deal with HMT for retail business

Oil and Natural Gas Corporation (ONGC) has forged a strategic alliance with HMT for its fuel retail business.

Subir Raha, chairman and managing director  of ONGC, and M S Zahed, chairman and managing director of HMT,  signed a memorandum of understanding for the retail collaboration recently.

ONGC, which opened its maiden petrol station at Mangalore in March, is talking to several companies, especially public sector undertakings (PSUs) with spare land, for setting up its chain of 1,600 outlets.

"We believe that the retail business is all about getting one's real estate right. ONGC has been talking to various companies, especially PSUs, that can offer vantage locations for OVaL outlets," a company official said.

OVaL or ONGC Values, is ONGC's retail brand, and had previously inked a deal with Ashok Leyland for retailing.

HMT - on its own and through its subsidiaries - possesses suitable sites for OVaL. ONGC, after jointly studying the feasibility, would initially have the land on leasehold for not more than 50 years. The machine tools manufacturer would have the right to display its products at the petrol pumps.

"Work on the first HMT-offered outlet has begun at Bangalore," the official said.

The other places where potential exists are Tumkur, Aurangabad, Hyderabad and along the Shimla-Chandigarh highway, he added. A special feature of these outlets would be customisation. Most of the HMT sites are in the rural areas where agri-oriented products, implements and equipment are marketed. OVaL would attempt to customise its outlets to suit the rural areas.