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Maharatna company

The Government of India has granted ‘Maharatna company‘ status to Central Public Sector Undertakings – Hindustan Petroleum Corporation Limited (BPCL) and Power Grid Corporation of India Limited (PGCIL).

What is Maharatna company?

Criteria required for Maharatna status

■ The company should attain Navratna status.

■ The company must be listed on an Indian stock exchange with a minimum prescribed public shareholding under Securities and Exchange Board of India (SEBI) regulations.

■ Average annual turnover during the last three years should be more than ₹25,000 crore.

■ Average annual net worth during the last three years should be more than ₹15,000 crore.

■ Average annual net profit during the last three years should be more than ₹ 5,000 crore.

■ The company must have a significant global presence.

Benefits of Maharatna status

■ The objective of the Maharatna Scheme is to enable public sector undertakings to expand their business and emerge as global class companies.

■ Giving Maharatna status will increase their autonomy and operational power. Also, they will have the freedom to take all decisions related to financial matters.

■ Maharatna companies can make equity investments to set up financial joint ventures and wholly owned subsidiaries.

■ Maharatna companies can undertake mergers and acquisitions with domestic and foreign companies with an absolute limit of ₹5000 crore, including a limit of 15% of their net worth.

■ The Board of Directors of Maharatna companies has the authority to create posts below the level of the Board of Directors and make plans related to human resource management and training.

Central Public Sector Enterprises (CPSES)

■ Enterprises and undertakings controlled and operated by the Government of India are called CPSEs. The government’s stake in such enterprises is 51% or more.

■ After the inclusion of BPCL and Power Grid PGCIL, the number of Maharatna companies in India increased to 10 which are as follows –