Context (LM): The Department of Public Enterprises (DPE) upgraded the four Central Public Sector Enterprises (CPSEs) – Railtel Corporation of India, Solar Energy Corporation of India, SJVN (Satluj Jal Vidyut Nigam), and NHPC – to ‘Navratna‘ status.
Satluj Jal Vidyut Nigam
It is an Indian public sector undertaking involved in hydroelectric power generation and transmission.
It was incorporated in 1988 as Nathpa Jhakri Power Corporation, a joint venture between the Government of India and the Government of Himachal Pradesh.
NHPC (National Hydroelectric Power Corporation)
NHPC Limited is India’s leading hydropower company, with a total installed capacity of 7,097.2 MW of renewable energy.
Established in 1975, Headquartered in Faridabad, Haryana.
The company has expanded its objects to include other sources of energy like Solar, Geothermal, Tidal, Wind etc.
At present, NHPC is a Mini Ratna Category-I Enterprise of the Central Government.
Navratna Status
In 1997, the government launched the Navratna plan to select CPSEs with comparative advantages and to help them become global giants.
Eligibility
The CPSE should be a Miniratna Iand Schedule A Company.
The CPSE should have obtained an ‘excellent’ or ‘very good’ rating in three of the last five MOUs.
The CPSE should have obtained a composite score of 60 or more, calculated concerning six specified parameters or ratios.
Net Profit to Net Worth (25%)
Manpower Cost to Cost of Production or Cost of Services (15%)
PBDIT (Profit Before Depreciation, Interest, and Taxes) to Capital Employed (15%)
PBDIT to Turnover (15%)
Earnings Per Share (10%)
Inter-Sectoral Performance (20%)
Benefits
The Navratna status grants enhanced autonomy in financial and operational matters to CPSEs.
They can make large investments of up to Rs 1,000 crore or 15% of their net worth on a single project without needing permission from the Central Government.
They can invest up to 30% of their net worth annually but it should not exceed Rs.1000 crores.
They can establish joint ventures overseas, access new markets, and leverage local expertise.
It empowers companies with faster decision-making, increased efficiency, and greater empowerment.
Criteria for granting Maharatna status to CPSEs
CPSEs having Navaratna status.
Listed on the Indian stock exchange with minimum prescribed public shareholding under SEBI regulations.
Should have a significant global presence/international operation.
In the last three years, the company should have achieved,
Average annual turnover > Rs. 25,000 crores.
Average annual net worth > Rs. 15,000 crores.
Average annual net profit (after tax) > Rs. 5,000 crores.
Criteria for granting Miniratna status to CPSEs
Miniratna Category-I status
Must have achieved profitability in the last threeconsecutive years.
Need to demonstrate a pre-tax profit of Rs.30 crores or more in at least one of the three years.
Must maintain a positive net worth.
Miniratna Category-II status
Requires a consistent track record of profitability for the last three consecutive years.
They should also have a positive net worth to be eligible for consideration.
