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What are PSU's?

Central Public Sector Enterprise

PSUs are government-owned corporations or state-owned enterprises created by the Government of India to undertake commercial activities on behalf of government. Several Public Sector Undertakings (PSUs) under the aegis of Government of India regularly provide tremendous employment opportunities in various technical and management areas.

As on 21 July , 2014 there are 7 Maharatna, 16 Navratna and 71 Miniratna CPSE's

There are multiple factors and criteria for granting 'ratna' status. However, major criteria of awarding status are:

Maharatna


• Three years with an average annual net profit of over Rs. 2500 crore (earlier was 5,000 Cr)
• Average annual Net worth of Rs. 10,000 crore for 3 years (earlier was 15,000 Cr)
• Average annual Turnover of Rs. 20,000 crore for 3 years (earlier was 25,000 Cr)

Navratna


• A score of 60 (out of 100), based on six parameters which include net profit, net worth, total manpower cost, total cost of production, cost of services, PBDIT (Profit Before Depreciation, Interest and Taxes), capital employed, etc.
• A company must first be a Miniratna and have 4 independent directors on its board before it can be made a Navratna.

Miniratna Category-I


• Have made profits continuously for the last three years or earned a net profit of Rs. 30 crore or more in one of the three years.

Miniratna Category-II


• Have made profits for the last three years continuously and should have a positive net worth. The Categorisation entitles the company boards to do investments up to a limit (depending on the status) without seeking government permission.
• Maharatna: up to Rs.1,000 crore - Rs. 5,000 crore, or free to decide on investments up to 15% of their net worth in a project.
• Navratna: up to Rs. 1,000 crore or 15% of their net worth on a single project or 30% of their net worth in the whole year (not exceeding Rs. 1,000 crores).
• Miniratna-I: up to Rs. 500 crore or equal to their net worth, whichever is lower.
• Miniratna-II: up to Rs. 300 crore or up to 50% of their net worth, whichever is lower.


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