Maharatna Companies in India: All You Need To Know

Introduction:

A sports player is a world record holder, an Olympic gold medalist, and crowned a world champion- you don’t know the specific names, yet you can tell that we are talking about some of the greatest sports players here. The landscape of government companies works on a similar track. Companies based on specific criteria are awarded Miniratna, Navratna, and Maharatna status. In this article, let’s discuss the Maharatna companies in India.

What are Maharatna Companies?

Maharatna companies are some of India’s most financially strong and highly influential. “Maharatna” translates to “a great jewel,” underscoring their immense value to the nation and the world. 

The Maharatna status is a prestigious recognition for select PSUs in India, giving them more autonomy and financial power. Introduced by the Indian government in 2009, this status aims to empower large PSUs to become global giants. It enhances their competitive edge, improves operational freedom, and boosts their economic contribution.

These companies are chosen based on performance, turnover, and net profit.  Significant global operations and listing on Indian stock exchanges are also required. With Maharatna status, the PSUs are trusted as a safe investment, so much so that many market insights mention the Maharatna companies. 

How many Maharatna Companies are in India?

As of 2024, there are 13 Maharatna companies in India. The list is as follows-

Sr. No.	Company Name	Market Cap as of 16th August 2024 (Rs. Cr.)	Maharatna Since
1	Bharat Petroleum Corporation Limited	1,44,624.08	2017
2	Steel Authority of India Limited	52,850.07	2010
3	Oil and Natural Gas Corporation	4,15,149.21	2010
4	Indian Oil Corporation Limited	2,35,824.68	2011
5	Oil India Ltd	1,12,276.60	2023
6	Bharat Heavy Electricals Limited	1,03,504.33	2013
7	Rural Electrification Corporation	1,54,794.07	2022
8	Hindustan Petroleum Corporation Limited	82,761.66	2019
9	Coal India Limited	3,19,660.72	2011
10	National Thermal Power Corporation	3,90,387.78	2010
11	Gas Authority of India Limited	1,56,684.62	2013
12	Power Finance Corporation	1,67,001.65	2021
13	Power Grid Corporation of India Limited		2019

Source- Link 1 and NSE

These stocks are listed on both the NSE and BSE. Now, ‘What is NSE?’ and ‘What is BSE?’. These are India’s two primary stock markets that the Securities Exchange Board of India regulates. 

Overview of the Maharatna Companies

1. Bharat Petroleum Corporation Limited:

One of the mahartna companies at the top of the list is Bharat Petroleum Corporation Limited (BPCL). Founded in 1956, the company became public in 1991. BPCL is a Public Sector Undertaking (PSU) with the Government of India holding a 52.98% stake as of 31st March 2023. It operates in India’s petroleum industry, focusing on refining crude oil and marketing petroleum products.  The company has seen its share of dips and peaks in the last five years. However, as of FY2024, it has a RoE of 41.9%, a net profit of Rs.26859 crore, and a dividend payout of 33%.

2. Steel Authority of India Limited:

SAIL, based in New Delhi, traces its origins to Hindustan Steel Limited, established in January 1954. As India’s largest steel-making company, SAIL manufactures and sells a wide range of iron and steel products. SAIL operates five integrated steel plants in Bhilai, Rourkela, Durgapur, Bokaro, and Burnpur, along with three unique steel plants in Salem, Durgapur, and Bhadravathi. 

The company received the prestigious “Best of All” Rajiv Gandhi National Quality Award for its Bhilai and Bokaro plants in 1993, 2006, and 2007. As of FY2024, the company gave a dividend payout of 13%, posted a net profit of Rs.3067 crore, and maintained a compounded sales growth of 15% over the last three financial years. 

3. Oil and Natural Gas Corporation:

ONGC, established by the Government of India in 1956, has over 60 years of experience in oil exploration. It has discovered 8 of India’s 9 producing basins and is the country’s largest crude oil and natural gas company, contributing about 71% to domestic production. In FY’24, the company drilled 544 wells, the highest in 34 years, including 103 exploratory and 441 development wells. 

ONGC has a strong project pipeline, with six significant projects approved at a total cost of Rs.11,000 crore and 23 ongoing projects costing Rs.62,343 crore. Moreover, the company partnered with NTPC Green Energy and SJVN Green Energy during FY2024 to advance its net-zero carbon emissions goal by 2038. Financially, it reported Rs.6,55,258.9 crore in revenue, Rs.57,100 crore in profit, and a total dividend payout of Rs.12,894 crore for FY2024.

4. Indian Oil Corporation Limited:

Indian Oil Corporation Limited (IOCL) is India’s leading oil and gas company. They handle everything from exploration and production to refining and marketing. IOCL refines crude oil, transports it through pipelines, and markets natural gas and petroleum products. 

Their product range includes jet fuel, diesel, LPG, gasoline, bitumen, and lubricants. IOCL operates 11 of India’s 23 refineries under the Ministry of Petroleum and Gas. In FY2024, the company filed 1,736 patents and invested Rs. 946 crore in research and development. It has also posted a 5-year CAGR profit growth of 19.1%. 

5. Oil India Limited:

Oil India Limited focuses on exploring and producing oil and natural gas. It carries out activities like seismic and geodetic work, acquiring and analyzing 2D and 3D data, drilling, and developing fields. Additionally, OIL offers a range of E&P services for oil blocks. It also owns and operates a fully automated 1,157-kilometer crude oil trunk pipeline from Naharkatia to Barauni. OIL has maintained a dividend payout of 25%. However, it posted a net profit of Rs.6,980.85 crore in FY2024, less than the previous year’s profit of Rs 9854.39. 

6. Bharat Heavy Electricals Limited:

BHEL is India’s flagship engineering and manufacturing company, owned and controlled by the government. It specializes in producing and managing power plant equipment. They design, engineer, manufacture, erect, test, commission, and service various products and services across key sectors, including Power, Transmission, Industry, Transportation, Renewable Energy, Oil & Gas, and Defence. In FY2024, the company strengthened its order book with an order of over Rs.10,000 crore from Damodar Valley Corporation (DVC). Plus, the company stocks have given a return of 203.11% in the last 12 months as of 16th August 2024. 

7. REC Limited:

REC, a Central Public Sector Undertaking under the Ministry of Power, is vital in financing the entire power sector value chain, from generation to distribution. In the financial year 2023-24, the company achieved record-breaking milestones, with the highest-ever sanctions of Rs.3,58,816 crore and disbursements of Rs.1,61,462 crore. It also maintained the highest domestic rating of “AAA” for its debt instruments from CRISIL, ICRA, CARE, and India Ratings & Research. The total dividend payout for 2023-24, including the proposed final dividend, will be Rs.4,213.16 crore. Additionally, the company was honored with the SKOCH ESG Award 2024 in the ‘Renewable Energy Financing’ category. 

8. Hindustan Petroleum Corporation Limited:

HPCL is an energy company focused on refining crude oil and transporting and marketing petroleum products. They have a wide distribution and marketing network with LPG storage facilities, pipelines, terminals, relay depots, aviation service stations, and retail outlets. Besides this, HPCL also manufactures sugar and ethanol and generates electricity. In 2023-24, HPCL recorded the highest throughput of 59.4 MMT in petroleum product supply and distribution. Plus, its pipeline operations saw a record throughput of 25.8 MMT. In January 2024, HPCL established a new subsidiary, HPCL Renewable & Green Energy Ltd. (HPRGE), and in FY2024, it achieved its highest-ever consolidated Profit After Tax (PAT) of Rs.16,015 Crore.

9. Coal India Limited:

Coal India, founded in 1973 as Coal Mines Authority Ltd. after the coal sector’s nationalization, is a significant player in coal mining and production. The company also runs coal washeries. Its primary customers are in the power and steel industries, but it also serves sectors like cement, fertilizers, and brick kilns. Operating under the Ministry of Coal, Government of India, with its headquarters in Kolkata, West Bengal, Coal India holds about 48% of India’s proven coal reserves. Over the past 14 years, as of FY2024, it has consistently paid dividends and produced 773.647 million tons of coal. The company has also launched 71.63 MW of solar power projects, 18 ongoing R&D projects, and 23 new coal mining projects in FY2024.

10. National Thermal Power Corporation:

NTPC, founded in 1975, is India’s largest energy producer, aiming to provide reliable and efficient power in an eco-friendly way. The company generates and sells bulk power to state utilities and is involved in consultancy, project management, energy trading, oil and gas exploration, and coal mining. NTPC uses fossil fuels and renewable sources like hydropower, aligning with India’s goal to cut carbon emissions by 33-35% by 2030. It holds 17% of India’s installed power capacity and contributes 24% to its power generation as of FY2024. NTPC is also expanding into nuclear power with a 2.8 GW project in Rajasthan in collaboration with the Nuclear Power Corporation of India. In FY2024, NTPC jumped 61 spots to rank 372nd on Forbes’ Global 2000 List for 2024. 

11. Gas Authority of India Limited:

GAIL, incorporated in 1984, is an undertaking of the government of India and a leading natural gas company in the country. It operates over 11,500 km of natural gas pipelines, over 2,300 km of LPG pipelines, six gas-processing units, and a petrochemical facility. The company holds joint ventures in Petronet LNG Ltd, Ratnagiri Gas and Power Pvt Ltd, and city gas distribution businesses in various cities. Expanding globally, GAIL has subsidiaries in Singapore and the US, focusing on LNG, petrochemical trading, and shale gas assets. In FY2024, GAIL signed two 10-year LNG supply agreements: 1 MMTPA with Vitol Asia Pte Ltd, Singapore, and 0.5 MMTPA with ADNOC Gas, UAE, starting in 2026. Additionally, the company generated Rs.1,33,228 crore in revenue and Rs.9.903 crore in profit after tax.

12. Power Finance Corporation Limited:

Established in 1986, PFC provides crucial financial assistance to India’s power sector. It offers loans for power generation, transmission, and distribution projects, which are essential in developing energy infrastructure. PFC operates under the Ministry of Power and is organized into three divisions: Commercial, Projects, and Finance & Financial Operations, each led by a Functional Director. 

As an Indian NBFC, PFC offers rupee-term loans, short-term loans, equipment lease financing, and transitional financing services tailored to the power sector’s needs across generation, transmission, and distribution projects. As of FY2024, the company’s net worth increased by 20% from the previous year to Rs.1,34,289 crore. 

13. Power Grid Corporation of India Limited:

PGCIL is the country’s largest electric power transmission company. Established in 1989, it operates under the Ministry of Power, Government of India. PGCIL is responsible for planning, implementing, operating, and maintaining the Inter-State Transmission System (ISTS). It also provides telecom and consultancy services. 

Headquartered in Gurugram, Power Grid handles around 50% of the power generated in India. With an extensive network of 1,77,699 km of transmission lines and a transformation capacity of 5,27,446 MVA, it plays a critical role in powering the nation. Moreover, the company has maintained a 3-year CAGR revenue growth rate of 4.7% as of 16 August 2024. 

How does a company qualify for the Maharatna companies status?

To qualify as a Maharatna company, an enterprise must meet several criteria. 

• First, it must hold a Navratna status. 
• Second, its stocks must be listed on the Indian Stock Exchange with the minimum required public shareholding as per SEBI regulations. 
• Additionally, the enterprise should have an average annual turnover exceeding Rs.25,000 crore over the last three years and an average net worth of Rs. 15,000 crore over the previous three years. 
• It must have profited after taxes of at least Rs.5,000 crore over the past three years. 
• Lastly, the enterprise must operate internationally and have a notable global presence.

The Maharatna company list isn’t evaluated regularly. The process says that whenever a company meets the criteria, Maharatna status will be awarded. However, the company must maintain the eligible performance level to remain on the list. 

But what perks does the Maharatna company’s status bring in for the company?

Features of Maharatna Companies:

• Maharatna companies have greater autonomy in decision-making, allowing for more flexibility in investments, joint ventures, and strategic decisions.
• They possess enhanced financial powers, enabling them to make significant investments independently without government approval, up to a specific limit.
• These companies are encouraged to expand globally, and they are free to explore and invest in international projects within specific guidelines.
• They are strategically important to the country, playing a crucial role in the economy across energy, mining, steel, and telecommunications sectors.
• Maharatna companies are expected to uphold higher corporate governance and transparency standards, complying with guidelines from the Department of Public Enterprises (DPE) and other regulatory bodies.
• Despite their increased autonomy, they remain under the control and ownership of the Government of India, balancing commercial interests with national priorities.
• They generally have a large workforce and are expected to contribute positively to society through Corporate Social Responsibility (CSR) initiatives.

Conclusion:

Maharatna companies are the giants of India’s business world, big in size and impact. They power your homes, fuel your vehicles, and build our infrastructure. These companies play vital roles in shaping India’s future and representing the nation globally. As India grows, these Maharatna companies will stay at the forefront, driving innovation, creating jobs, and contributing to our progress. 

If you wish to add the Maharatna companies to your stock portfolio, analyze your financial profile thoroughly and take the final call with the help of a registered stock market advisory. 

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