New Delhi: India's largest power transmission company and a Navratna PSU till now, Powergrid Corporation of India Limited (PGCIL), is now a Maharatna PSU. Ministry of Heavy Industries and Public Enterprises issued the letter of approval on Wednesday.
PSU Watch had reported the news about the recommendation made by Power ministry for the Maharatna tag to be awarded to PowerGrid earlier this year in January. PowerGrid is the 10th PSU in all, and second in power sector to have entered into Maharatna club, after Bharat Heavy Electricals Ltd (BHEL), Indian Oil Corporation, Oil & Natural Gas Corp (ONGC), Bharat Petroleum Corp (BPCL), Coal India Ltd (CIL), NTPC Ltd and Steel Authority of India Ltd (SAIL), Hindustan Petroleum Corporation Ltd (HPCL) and Gas Authority of India Limited (GAIL).
The PowerGrid management will now be able to exercise greater financial autonomy as they can now decide on investments of up to 15% of their net worth in a project without the approval of the government. While as a 'Navratna’ company PGCIL could invest only up to Rs 1,000 crore without government approval.
Ministry of Heavy Industries and Public Enterprises issued the letter of approval on Wednesday
PowerGrid's financial performance in past a few years has been phenomenal. In the FY'19 the company's standalone net profit jumped to Rs 9,938.55 crore from Rs 8,244.65 crore in FY'18. Total standalone income also increased to Rs 35,618.07 crore in the fiscal from Rs 30,766.32 crore in 2017-18. The company’s consolidated net profit in 2016-17 was Rs 7,451 crore, while total consolidated income was Rs 26,283 crore in 2016-17.
Criteria for a PSU to get 'Maharatna' status
The government grants the status of Navratna, Miniratna and Maharatna to Central Public Sector Enterprises (CPSEs) based upon their performance and profit. To get a Maharatna status the CPSEs have to full-fill given criteria:
- First of all, to get a Maharatna status, a company should be a Navratna PSU or holding Navrtana status.
- The PSU should be listed on the Indian stock exchange and must be fulfilling the minimum prescribed public shareholding criteria according to the SEBI regulations
- The average annual turnover of the company during the last 3 years should be more than Rs. 25,000 crore.
- The average annual net worth during the last 3 years should be more than Rs. 15,000 crore.
- The average annual net profit after tax during the last 3 years should be more than Rs. 5,000 crore.
- The company should have a significant global presence or international operations.
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