In 2009, the government established the Maharatna status, which raises a company's investment ceiling from Rs. 1,000 crore to Rs. 5,000 crore. The Maharatna firms can now decide on investments of up to 15 per cent of their net worth in a project; the Navaratna companies could invest up to Rs 1,000 crore without explicit government approval. Criteria
The six criteria for eligibility as Maharatna are:
1. Having Navratna status.
2. Listed on Indian stock exchange with minimum prescribed public shareholding under SEBI regulations. 3. An average annual turnover of more than Rs. 20,000. crore during the last 3 years. Earlier it was Rs 25,000 Crore. 4. An average annual net worth of more than Rs. 10,000 crore during the last 3 years. Earlier it was Rs. 15,000 crore. 5. An average annual net profit after tax of more than Rs. 2500 crore during the last 3 years. Earlier it was Rs. 5000 crore. 6. Should have significant global presence/international operations. (The earlier criteria stands as on date, as the order modifying the criteria was later withdrawn. But, needs confirmation)
MAHARATNA/NAVRATNA/MINIRATNA STATUS FOR PUBLIC SECTOR UNDERTAKINGS The status of Maharatna, Navratna, Miniratna to CPSEs is conferred by the Department of Public Enterprises- External website that opens in a new window to various Public Sector Undertakings. These prestigious titles provide them greater autonomy to compete in the global market. Maharatna
A company qualifying for the Maharatna- External website that opens in a new window status should have an average annual turnover of Rs 20,000 crore during the last three years against Rs 25,000 crore prescribed earlier. The average annual net worth of the company should be Rs 10,000 crore. The Maharatna status empowers mega CPSEs to expand their operations and emerge as global giants. The coveted status empowers the boards of firms to take investment decisions up to Rs 5,000 crore as against the present Rs 1,000 crore limit without seeking government approval. The Maharatna firms would now be free to decide on investments up to 15% of their net worth in a project, limited to an absolute ceiling of Rs 5,000 crore. Navratna
The Central Public Sector Enterprises (CPSEs) fulfilling the following criteria are eligible to be considered for grant of Navaratna- External website that opens in a new window status: * Having Schedule 'A' and Miniratna Category-1 status.
* Having at least three 'Excellent' or 'Very Good' Memorandum of Understanding (MoU) ratings during the last five years. For detailed information on criteria for Navratna status click here- External website that opens in a new window. The Navratna status empowers PSEs to invest up to Rs. 1000 crore or 15% of their net worth on a single project without seeking government approval. In a year, these companies can spend up to 30% of their net worth not exceeding Rs. 1000 cr. They also enjoy the freedom to enter joint ventures, form alliances and float subsidiaries abroad. Miniratna Category
For Miniratna category I status, the CPSE should have made profit in the last three years continuously, the pre-tax profit should have been Rs. 30 crores or more in at least one of the three years and should have a positive net worth. For category II, the CPSE should have made profit for the last three years continuously and should have a positive net worth. Miniratnas can enter into joint ventures, set subsidiary companies and overseas offices but with certain conditions. This designation applies to PSEs that 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 CPSEs
Category II miniratnas have autonomy to incurring the capital expenditure without government approval up to Rs. 300 crore or up to 50% of their net worth whichever is lower....