India’s Top PSUs 2019

22 Budget Proposals FY20 • The target of ` 1,050 bn of disinvestment receipts set for FY20. • The budget proposed to reinitiate the process of strategic disinvestment of Air India and to offer more PSUs for strategic participation by the private sector. • The government to consider going to an appropriate level below 51% in PSUs where the government control is still to be retained, on case to case basis. • The present policy of retaining 51% government stake to be modified to retaining 51% stake inclusive of the stake of government-controlled institutions. • The budget proposed to meet public shareholding norms of 25% for all listed PSUs and raise the foreign shareholding limits tomaximumpermissible sector limits for all PSU companies which are part of Emerging Market Index. • The budget proposed to apply concessional rate of short-term capital gains tax to fund of funds set up for disinvestment of Central Public Sector Enterprises (CPSEs), to which concessional rate of long-term capital gains tax has already been extended. • New Space India Limited (NSIL), a PSU, was incorporated as a new commercial arm of ISRO. Other policy initiatives in FY18 • The government and market regulators have taken measures for development of monetisation vehicles Infrastructure Investment Fund (InvIT) and Real Investment Trust (ReITs) in India. • The proposals for diversification of portfolios to maintain business performance were taken up by the Boards of PSUs. In addition, the Boards of Maharatna and Navratna PSUs have been delegated powers, inter-alia, to (i) incur capital expenditure without government approval on purchase of new items or for replacement, to take up new projects, modernization, etc., (ii) make equity investment to establish financial joint ventures and wholly owned subsidiaries, and (iii) undertake mergers & acquisitions subject to laid down conditions. The Boards of Maharatna and Navratna PSUs have also been delegated powers to raise debt from domestic and international markets. • After merger of the State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Travancore, State Bank of Patiala, State Bank of Hyderabad and Bharatiya Mahila Bank with the State Bank of India on April 1, 2017, the government approved amalgamation of Dena Bank and Vijaya Bank with Bank of Baroda w.e.f. April 1, 2019. Some of the key financial performance highlights of the featured 169 PSUs during FY18 are:- • The aggregate total income of the 169 profiled PSUs stood at around ` 33.7 trillion in FY18; showing a growth of nearly 8% as compared to FY17 • Petroleum– refining &marketing sector emerged as the largest contributor in the non-financial segment accounting for nearly 53% and 34% of the aggregate income and profit respectively • The eight Maharatnas and 16 Navratnas account for nearly 52% and 20% of the aggregate total income of the companies from the non-financial segment • In terms of income growth, Maharatnas and Navratnas, both grew by 11% in FY18 compared to the previous year