Oil India elevated as 13th ‘Maharatna’ company, ONGC Videsh rises to ‘Navaratna’ status

Being elevated to the Maharatna status is a significant milestone for Oil India Limited (OIL), a state-run oil and gas company in India. The decision to grant Maharatna status to OIL was made based on the recommendation from the Finance Ministry of the Indian government.

The Maharatna status is a prestigious recognition conferred upon select Central Public Sector Enterprises (CPSEs) in India. To achieve Maharatna status, a CPSE must meet certain criteria set by the government. Some of the key criteria include:

1. Listing on Stock Exchange: The CPSE should be listed on Indian stock exchanges.

2. Net Worth: The CPSE should have a minimum average annual net worth of Rs. 15,000 crore for the last three years.

3. Profitability: The CPSE should have an average annual net profit after tax of at least Rs. 5,000 crore for the last three years.

4. Global Operations: The CPSE should have significant global operations or international presence.

5. Significant Projects: The CPSE should have undertaken projects of considerable size and scale, either in India or abroad.

6. Subsidiaries: The CPSE should have a minimum of three fully-owned and independent subsidiaries or joint ventures.

Once a CPSE is granted the Maharatna status, it gains greater financial autonomy, which allows it to take important business decisions without seeking government approval for investments up to a certain limit. This increased autonomy enables Maharatna CPSEs to pursue growth opportunities, invest in new projects, and expand their business operations more effectively.

By becoming the 13th Maharatna CPSE, Oil India Limited joins an elite group of public sector enterprises that have demonstrated exceptional performance and contributed significantly to the Indian economy. This recognition reflects the company’s achievements, financial strength, and strategic importance in the energy sector.

The Maharatna status will further strengthen Oil India Limited’s position in the market and empower it to play a more significant role in meeting India’s energy needs and contributing to the nation’s growth and development.

The decision to elevate the status of Oil India Limited (OIL) to Maharatna CPSE is aimed at enhancing the powers of the OIL board when it comes to making financial decisions. The move was approved by the Finance Minister of India.

The Department of Public Enterprises (DPE) shared the news on Twitter, stating that OIL would become the 13th Maharatna CPSE. OIL is a Central Public Sector Enterprise under the Ministry of Petroleum & Natural Gas. It has achieved significant financial success, with an annual turnover of ₹41,039 crore and a net profit of ₹9,854 crore for the Year 2022-23.

By being elevated to Maharatna status, OIL will gain greater financial autonomy, allowing its board to make important financial decisions without seeking prior approval from the government for investments up to a certain limit. This increased autonomy is expected to empower OIL to pursue strategic initiatives, undertake major projects, and expand its operations more efficiently.

The move is a recognition of OIL’s strong financial performance and its significant contribution to the energy sector in India. With its new Maharatna status, OIL is expected to play a more prominent role in meeting the nation’s energy needs and supporting India’s economic growth and development.

The Finance Ministry of the Indian government has approved the upgradation of Oil and Natural Gas Company (ONGC) Videsh Ltd (OVL) to the status of Navaratna Company. The Department of Public Enterprises shared this information, stating that OVL would become the 14th Navaratna CPSE (Central Public Sector Enterprise).

ONGC Videsh Ltd (OVL) is a Central Public Sector Enterprise under the Ministry of Petroleum & Natural Gas. It is primarily engaged in overseas exploration and production activities in the oil and gas sector. OVL has demonstrated strong financial performance, with an annual turnover of ₹11,676 crore and a net profit of ₹1,700 crore for the Year 2022-23.

By being elevated to the Navaratna status, OVL will gain enhanced financial and operational autonomy. The Navaratna status allows its board to make important financial decisions independently, up to a certain limit, without requiring prior approval from the government. This increased autonomy will enable OVL to pursue international business opportunities, undertake significant projects, and expand its global presence more efficiently.

The decision to grant Navaratna status to OVL reflects its success in overseas operations and its strategic importance in the energy sector. With this recognition, OVL is expected to strengthen India’s presence in the global oil and gas industry and contribute to the country’s energy security and economic growth.

As of August 4, 2023, the Finance Ministry of the Indian government has elevated Oil India Limited (OIL) to the status of the 13th ‘Maharatna’ company and Oil and Natural Gas Company (ONGC) Videsh Ltd (OVL) to the status of a ‘Navaratna’ company.

For Oil India Limited (OIL), the elevation to Maharatna status means that the company’s board will gain increased powers in making financial decisions, providing the company with greater financial autonomy. OIL is a state-run oil major and a Central Public Sector Enterprise (CPSE) under the Ministry of Petroleum & Natural Gas. It reported an annual turnover of ₹41,039 crore and a net profit of ₹9,854 crore for the Year 2022-23.

On the other hand, ONGC Videsh Ltd (OVL), the overseas arm and wholly-owned subsidiary of Oil and Natural Gas Corporation Limited (ONGC), has been granted the Navaratna status. This status empowers OVL with enhanced financial and operational freedom, allowing the company to invest up to ₹1,000 crore or 15% of its net worth in a single project without seeking government approval. OVL is also a CPSE under the Ministry of Petroleum & Natural Gas, with an annual turnover of ₹11,676 crore and a net profit of ₹1,700 crore for the Year 2022-23.

The Maharatna and Navaratna statuses are prestigious designations given to select CPSEs in India, which grant them greater decision-making powers and financial autonomy to foster growth and expansion. Companies with these statuses are expected to play a significant role in their respective sectors and contribute to the nation’s economic development.

The list of Maharatna CPSEs includes companies such as Bharat Heavy Electricals Limited (BHEL), Bharat Petroleum Corporation Limited (BPCL), Coal India Limited, GAIL India Limited, Hindustan Petroleum Corporation Limited (HPCL), Indian Oil Corporation Limited, NTPC Limited, Power Finance Corporation, Power Grid Corporation of India Limited, Rural Electrification Corporation Limited, and Steel Authority of India Limited (SAIL).

To be eligible for the Maharatna status, a company should have an average turnover of over ₹25,000 crore, an average annual net worth of more than ₹15,000 crore, and an average annual net profit of over ₹5,000 crore during the last three years. Similarly, for Navaratna status, the CPSE should meet specific financial criteria and demonstrate exceptional performance in its respective domain.