Power Finance Corporation acquires status of 'Maharatna'

Context 

The Centre awarded the prestigious 'Maharatna' position to Power Finance Corporation Ltd.

About Power Finance Corporation

• PFC was incorporated in 1986 and comes under the jurisdiction of the Union Power Ministry.
• It is India's largest company NBFC and the largest financial finance company.
• According to the Department of Public Enterprises Survey of FY 2017-18, PFC is the 8th most profitable Central Public Sector Enterprise (CPSE).

Significance of the award for PFC

• PFC has become the 11^th public sector business to secure the position of ‘Maharatna’ in the country.
• The awarding of the ‘Maharatna’ status will provide advanced powers to the PFC Board while making financial decisions.
• PFC is now joining other companies such as ONGC, Steel Authority of India Limited (SAIL), BHEL and Indian Oil Corporation.

Which company gets Maharatna Status?

• Maharatna status is given to a company that has recorded a profit of more than 5,000 crore for three consecutive years or an annual turnover of 25,000 crore for three years.
• To qualify for a position, a company must have an annual budget of Rs 15,000 for three years. Companies must also have global or operational measures.

Different status

Maharatna

• The average annual profit for a company over the past 3 years is more than Rs. 25,000 Crore.
• The average annual income over the past 3 years is more than Rs. 15,000 crores.
• The average annual income after tax for the past 3 years is more than Rs. 5,000 crore.
• This company must have a large global presence or international operation.

Navratna

• The Navratna status allows companies to invest up to Rs 1000 crore or 15 percent of the value of one project or 30 percent of their total annual value (not exceeding Rs 1000 crores).
• Miniratna I and II Category:
• Category I: These have made a profit over the past three years or have earned a full profit of Rs. 30 crore or more in one of these three years. There are 60 such companies.
• Category II: These companies have made a profit continuously for the last three years and should make a good profit. There are 15 such companies in this category.