India's Top PSUs 2021

17 Number of profit-making PSUs rises consistently 75 84 90 171 0 40 80 120 160 200 FY81 FY91 FY98 FY00 FY02 FY04 FY06 FY08 FY10 FY12 FY14 FY16 FY18 FY20 Number of PSUs No of loss-making PSUs No of profit-making PSUs Source: Public Enterprises Survey - Department of Public Enterprises & Ministry of Finance However, the efficiency gains earned earlier could not be sustained and the ROCE began shrinking since then, indicating some loss of competitive advantage. As of FY20, the aggregate return on capital stands at a modest 3%. Likewise, the net profit to net worth ratio, which peaked at 19% in FY05 began moderating thereafter, eventually shrinking to 8% in FY20. Profitability of PSUs begins deteriorating after FY05 2 13 3 3 19 8 0 5 10 15 20 25 FY91 FY95 FY00 FY05 FY10 FY15 FY20 Source: Public Enterprises Survey – Department of Public Enterprises In terms of business efficiency, while the sales-to-capital employed ratio rose from 100% in FY93 to 160% in FY09, it eventually deteriorated to 79% by FY20. This points towards less-than optimal levels of asset utilization across several companies within the universe of PSUs. Declining sales-to-capital ratio points to lower asset utilization 160 151 79 0 40 80 120 160 200 FY81 FY93 FY98 FY00 FY02 FY04 FY06 FY08 FY10 FY12 FY14 FY16 FY18 FY20 Sa les-to-Capital Ratios Source: Public Enterprises Survey – Department of Public Enterprises Dun & Bradstreet