SWOT Analysis of ONGC [step by step SWOT]

SWOT Analysis of ONGC focuses on (S) Strengths, (W) Weakness, (O) Opportunities, and (T) Threats. Internal Factors in the SWOT Analysis are Strengths and Weaknesses and External Factors in the SWOT Analysis are Opportunities and Threats.

SWOT Analysis is a proven management tool that helps organizations such as ONGC to assess the market of Oil and Gas and its success against rival companies. ONGC has been one of the leading Oil and Gas Company.

The Oil and Natural Gas Corporation (ONGC), is an oil and gas giant company and has a registered office located at New Delhi. ONGC was founded on 14 August 1956. ONGC is a public sector undertaking of the Government of India and is also India’s largest gas producer and exploration company.

It contributes 70 percent to India’s crude oil output and has a 62 percent natural gas share. The ONGC has commercially found 6 out of 7 Indian basins. It has led and passed several milestones in India’s energy ambitions. It has grown to become one of the largest E&P firms in the world in terms of revenue and reserves.

swot analysis of ongc

Strengths in the SWOT Analysis of ONGC – ONGC SWOT Analysis

Brand equities

The ONGC has invested in building a strong portfolio of brands and has ensured the creation of an environment conducive to the growth of the Indian economy. It has played a positive role in India’s growth cycle and has CSR projects that have focused on a variety of underdeveloped regions of the country. ONGC has been rated as the Best Employer and has a respectable reputation on both the Indian and international markets.

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Engineering: Engineering

ONCG guarantees the consistency of its goods through the integration of operations, and has also allowed the organization to scale up and down its capacities, based on the requirements on demand. The company has set up EPINET, a live E&P information network. The ONGC already has 3D visualization centers known as the “Third Eye” for the integration of offshore and onshore knowledge in real time. The organization has a Memorandum of Cooperation (MOC) with seven IITs to pursue advanced R&D projects.

Focusing on sustainability

The ONGC has assured that it preserves and manages the climate and that the coordinated Health, Security & Climate (HSE) system has proactively controlled the environment. The organization seeks to reduce the environmental effects that can be generated by operations such as fracking, mining and development by engaging in successful solid waste disposal, environmental inspection and analysis, and resource control programs.

The organization now maintains an ONGC Natural Gas STAR initiative to facilitate the successful execution and monitoring of efficient and cooperative methane emission reduction programs.

Strong Group Dealer

The ONGC has a large dealer network by creating a culture among dealers and distributors by encouraging them not only to support the company ‘s goods, but also to engage in educating and preparing the sales team to understand and maintain a relationship with the consumer and help them achieve the most benefits from the goods.

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Weaknesses in the SWOT Analysis of ONGC – ONGC SWOT Analysis

Competition :

Tata Petrodyne, a subsidiary of the TATA group, is considered to be one of the largest oil and gas firms with a turnover of about $200 billion. Oil India Limited (OIL) is also known to be the second largest hydrocarbon firm E&P (Exploration & Production) and has more than 11,000 workers with a turnover of $35 billion.

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Bharat Petroleum has large refineries in Cochin and Mumbai and has been listed by Fortune 500 firms. Such firms have been engaging in numerous R&D initiatives and the ONGC will take strategic steps to keep ahead of competition.

Investment in research and technology

Investment by the organization in research and development is said to be below the leading players in the industry. While the ONGC spends a fair deal on the R&D side, the business has not been able to compete with the leading players in the industry when it comes to innovation. The brand has come off as a business that wants to carry out goods based on the functionality testing.

Opportunities in the SWOT Analysis of ONGC – ONGC SWOT Analysis

Higher petrol costs

Due to increase in crude oil prices their can be a substantial increase in the Petrol prices which will lead to substantial gains for the company’s.

Research:

The company has established the Gas Hydrate Research & Technology Center (GHRTC). This center is contributing to the Government of India ‘s initiative to commercialize gas hydrates as an energy tool. This ONGC center has been active in finding deep-sea gas hydrate deposits on the coast of India, with fresh deposits valued at 134 trillion cubic feet. Analysis efforts performed in this manner would allow the organization to pursue new opportunities.

Threats in the SWOT Analysis of ONGC – ONGC SWOT Analysis

Regulation of the Government

There is also a danger to the company’s income from evolving regulatory legislation. There have been occasions where the government has asked the ONGC to help slash oil and diesel rates. There are occasions where it has been stated that the government has asked the company to bear the increase in oil prices at Rs 1 per liter. Such laws specifically impact the income of the ONGC.

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Electrical engines

According to the International Energy Agency, more efficient fuel technologies and electric cars are projected to reduce the need for oil transport by 2040, but it is also said that the world will face a supply shortage without a strong investment in new development. The efficiency of EV and even ride-sharing developments are projected to reduce oil use and demand for oil should rise more gradually in the next decade.

Fluctuating levels of crude oil

The fall of the rupee, even though it is said to contribute a minor sum to the increasing cost of energy. Global oil prices soared by 45 percent in terms of the dollar and the increase was 49 percent in the rupee. The rise in oil prices would lead to inflationary pressures and push RBI to lift interest rates.

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"SWOT Analysis of ONGC [step by step SWOT]." Projects4MBA [Online]. Available: https://www.projects4mba.com/swot-analysis-of-ongc/2425/. [Accessed: August 5, 2020]
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