The companies have qualified for the coveted status under the criteria approved by the Cabinet on December 24, 2009. Once the new status is conferred, they will be free to make foreign investments of up to Rs 5,000 crore without taking government approval.
Besides NTPC, ONGC and SAIL, IOC is the fourth one to have qualified. I hope the status will be conferred in the next 10 days, department of public enterprises (DPE) secretary Bhaskar Chatterjee told FE.
According to the qualifying criteria approved by the cabinet, the Maharatna tag will be granted to listed Navaratna central public sector companies (CPSEs) with an average annual turnover of more than Rs 25,000 crore, net profit after tax of Rs 5,000 crore and net worth of Rs 15,000 crore in the last three years. Coal India has also fared really well, but it has a limitation of not being listed on any stock exchange, Chatterjee said.
Earlier, the government had said it would set up a committing to scrutinise the financials of each listed CPSE. With the delay in putting in place such a panel, the DPE seems to have assumed the task of going through the documents of CPSEs itself. The committee has not been set up as of now. As we have the audited results of all the CPSEs, we could identify the companies ourselves. The final decision is on the Heavy Industries & Public Enterprises minister Vilasrao Deshmukh, Chatterjee said.
The autonomy to invest up to Rs 5,000 crore in JVs will be given to the companies subject to the condition that the investment is not more than 15% of its net worth. Also, such an investment should not result in a CPSEs total equity in JVs exceeding 30% of its net worth. At present, the Navaratnas are free to invest up to Rs 1,000 crore in joint ventures.