Managing director Kishu Gomes told shareholders the lube market has been contracting for three quarters in a row mainly due to lower demand from thermal power generation sector as rains increased hydro power.
Agricultural and fisheries sector demand was also down, Gomes said.
The overall market was also slowing with extended oil drain intervals with customers moving to higher technology products.
The rate of growth in the North and East of the country has also slowed."..[T]his decline has been seen across all consumer segments in almost all geographies which resulted in a reduction in revenue compared to last year," Gomes said.
"However the consumer shift from low tier to higher tier technology has provided the opportunity to raise the unit gross margin in certain product/brand segments."
According to the Public Utilities Commission, the regulator, volumes had fallen 4 percent in 2012, he said.
Chevron said profits rose 17 percent to 609 million rupees in the September quarter from a year earlier. The firm reported earnings of 5.08 rupees per share for the quarter.
The stock closed at 270 rupees flat, Thursday.