Indian Oil plans to launch own-brand bottled drinking water at 43,000 fuel outlets

Indian Oil Corporation has a network of over 43,000 retail outlets in India. | Photo credit: File Photo

State-owned oil refiner and oil company Indian Oil Corporation is considering launching bottled drinking water under its own brand across its network of over 43,000 retail outlets in the country.

The plan is part of the company’s strategy to increase non-fuel revenue and offer value-added products to customers. It proposes a multi-year revenue sharing model led by aggregators, under which ownership of the brand will remain with Indian Oil.

The selected aggregators will take care of the end-to-end implementation, from manufacturing to approved facilities, quality assurance, supply chain management, logistics and rollout, Indian Oil said in an invitation for expression of interest (EoI) from firms.

Take highway exits

The phased rollout will eventually cover all 43,603 stores. Highway retail outlets, numbering 21,435 or almost half of the network, are expected to play a major role, with on-the-go drinking water demand highest at these establishments. Urban and semi-urban outlets will follow closely, the EoI for the selection of aggregators showed.

Polyethylene terephthalate (PET) bottles of 250 ml, 500 ml and 1 liter will initially be part of the rollout. The 1 liter pack will be positioned as the main product. In the future, Indian Oil may consider launching premium water, natural mineral water, alkaline water, functional hydration products and other pack sizes.

Watch out for more income from non-fuel sources

Apart from brand ownership, Indian Oil will control product pricing, selling price to MRP ratio and dealer margin. On a broader level, the company is targeting to increase non-fuel revenue from ₹200 crore to ₹760 crore with a target GMV of over ₹11,000 crore.

In the 2025-2026 annual report, chairman AS Sahney said the company is targeting to double the fast-growing routes in bitumen, jet fuel, lubricants, refueling fuel and non-fuel retail amid the country’s rapid infrastructure development, urbanisation, increasing mobility and expanding industrial activity.

According to IOC, it has 195 million square feet of retail space and more than 3.2 million customers visit the facility daily. It has partnered with several brands including Hindustan Unilever, Dabur, ICICI Bank, Ferns & Petals, MTR Foods and PVR Cinemas as part of plans to increase non-fuel revenue.

Retail stores for now

The EoIs are limited to fuel dispensers or petrol pumps as they are commonly known and cover all categories from Company Owned, Company Operated (COCO), Dealer Owned, Dealer Operated to Kisan Seva Kendras. Other Indian Oil business channels including LPG agencies, institutional / direct customers, IOCL offices, e-commerce or open market / regular trade (bazaar) sales are not covered for now.

If it goes ahead with the proposal, Indian Oil will be eyeing a pie of the Indian bottled drinking water market. Citing studies, the India Brand Equity Foundation estimated the market at ₹32,040 crore (US$3.6 billion) in 2025 and is projected to reach ₹57,850 crore (US$6.5 billion) by 2032. Growth will be fueled by population growth, increasing per capita consumption and increasing penetration of branded water packages.

Published – 29 Sep 2026 16:40 IST