HPCL (Hindustan Petroleum) PESTLE Analysis

Published by MBA Skool Team, Last Updated: February 28, 2021

PESTLE Analysis of HPCL (Hindustan Petroleum) analyses the brand on its business tactics. HPCL (Hindustan Petroleum) PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand.

PESTLE analysis is a framework which is imperative for companies such as HPCL (Hindustan Petroleum), as it helps to understand market dynamics & improve its business continuously. PESTLE analysis is also referred to as PESTEL analysis.

Let us start the HPCL (Hindustan Petroleum) PESTLE Analysis:

Political Factors:

The political factors in the HPCL (Hindustan Petroleum) PESTLE Analysis can be explained as follows:

HPCL is a subsidiary oil refinery for the ONGC which has its operations all over India. To have its operations smoothly, there should be stable government policies in the country. The government also looking for disinvestment which is crucial thing to look on. The government policies in the international affairs also have huge impact on the operations of the HPCL. The conflict between the US and Iran makes the company to depend on the crude oil from the other countries on the higher prices. The policies with the crude oil producing countries also impact on the operations of the company. The company should be more proactive in these cases.


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Economic Factors:

Below are the economic factors in the PESTLE Analysis of HPCL (Hindustan Petroleum):

Due to pandemic, the demand for the crude oil has decreased a lot.

The economy of the people also decreased. Due to this people employ the cost cutting procedures. The reduction in the operations of many industries also impacts operations of HPCL. For any company the economy health of the industry and people is important. The company should also observe the policies make by the government on the GST. The government has increased its tax rate on the petrol and diesel. The government also reduces the subsidiary given to people on the LPG. These policies impact on the business of the company. The company should also keenly observe the crude oil prices which has huge impact on the business.


Social Factors:

Following are the social factors impacting HPCL (Hindustan Petroleum) PESTLE Analysis:

Due to urbanisation and ease of operations, people have changed their things a lot. Today people are considering to have own vehicles in their family. The way of use of these vehicles also has changed in the recent years. The change in trends make the rise in the demand for the crude oil in the country. People are also having concern on the climate change and going towards the bio fuels. The company should focus on this for the future purpose. HPCL should also keep in mind the fast-changing consumer behaviour and the perspective towards the renewable energy resources. The consumers also buying the electric vehicles and electric products for the domestic process. These are some of the factors where the company should look on.


Technological factors:

The technological factors in the PESTLE Analysis of HPCL (Hindustan Petroleum) are mentioned below:

HPCL should focus on the technology to improve its operations and cost reducing factors. The new technologies improve the operations of the company to discover the crude oil and to build the oil pipe lines. Technology also embraces the operations to extract the crude oil and refine it for the domestic purpose. The new industrial revolution helps the company for the better practices in the refining. The company also supplies petrol, diesel, gas to all over the country. It also should incorporate the AI, IOT, ML to improve its supply chain.

It also should embrace the technology to improve its logistics.


Legal Factors:

Following are the legal factors in the HPCL (Hindustan Petroleum) PESTLE Analysis:

HPCL operates in many states which has different laws to operate. The company should abide to the rules and regulations where it operates. It should also observe the tax rates on the diesel and petrol in each state. It also should ensure that these costs are confide to those state only. The company should also take permissions for the logistics. The companies distribute the petrol and diesel with the help of the dealers. So, it has to take care on the agreements made with the dealer.


Environmental Factors:

In the HPCL (Hindustan Petroleum) PESTLE Analysis, the environmental elements affecting its business are as below:

HPCL should focus on the safe environmental activities in extracting and refining the crude oil. It impacts on climate change more. It should also include the practices where it can decrease the carbon foot print and reduce its impact on climate change which has huge impact on the economy of the country.

It also should focus on the environmental laws for the establishing the oil pipe lines. The company should further increase the eco-friendly activities where it cuts many trees for its operations. the company should see the environmental factors as a risk and should manage these risks with eco-friendly activities.

To conclude, the above HPCL (Hindustan Petroleum) PESTLE Analysis highlights the various elements which impact its business performance. This understanding helps to evaluate the criticality of external business factors for any brand.

This article has been researched & authored by the Content & Research Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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