New Delhi: BHEL and GAIL would soon be awarded the coveted Maharatna status, which will give these public sector units greater financial autonomy.
The proposals for granting the coveted tag have been approved by the high-level secretaries' panel headed by Cabinet Secretary Ajit Kumar Seth.
Asked when the status is expected to be granted to BHEL and GAIL, Minister of Heavy Industries and Public Enterprises Praful Patel told PTI, "The proposals have been done (cleared by apex panel). Formal orders will be issued in a couple of days for granting the status."
At present, BHEL and GAIL are Navratna PSUs.
A Maharatna firm can take investment decision of up to Rs 5,000 crore without going to the government. For Navratna firms, this limit is Rs 1,000 crore.
BHEL and GAIL qualify for the coveted status as these companies meet the eligibility criteria in terms of net worth, turnover and net profit.
"Both the PSUs have met the criteria for the Maharatna tag," an official said.
A company qualifying for the Maharatna status should have an average annual turnover of more than Rs 25,000 crore in the last three years, according to the Department of Public Enterprises guidelines.
Among others, the PSU must have a net worth of over Rs 15,000 crore and net profit of more than Rs 5,000 crore during the last three years.
As regards BHEL, the company's net profit stood at Rs 7,039 crore on a turnover of Rs 49,244 crore. The entity's net worth stood at Rs 25,373 crore during 2011-12.
While GAIL meets two parameters related to turnover and net worth, its net profit falls short of the eligibility criteria of Rs 5,000 crore on an average annual basis in the last three fiscals.
This is because GAIL along with state-owned explorer ONGC and Oil India Ltd sold LPG and crude oil to refineries at a discount to partly compensate them for selling diesel and cooking fuel below cost.
Sources said GAIL meets the criteria after taking into account the fuel subsidy it provides to oil marketing firms.
State gas utility firms' net profit stood at about Rs 3,653 crore, turnover was about Rs 41,000 crore and net worth Rs 21,449 crore in 2011-12.
At present, there are five Maharatna companies ? ONGC, Indian Oil, SAIL, NTPC and CIL and 16 Navratna companies, including Rashtriya Ispat Nigam Limited and NMDC.
First Published: Thursday, January 31, 2013, 21:17