All About PSUs: Public Sector Enterprises In India

All About PSUs: Public Sector Enterprises In India

Whether you are an investor or a college student looking for a job, both of you should know about PSUs.

We have heard a lot about PSUs but no one exactly knows what they are. Investors are interested in PSUs because they want to buy their stocks and make money quickly. On the other hand students are interested because they want a high paying job with limited working hours.

However serious investors and students both need to know more about PSUs beyond its full form.

In the following article, you are going to learn everything about PSUs very concisely.

What are PSUs?

As you already know PSU stands for Public Sector Undertaking. They are basically government owned independent bodies.

In India, PSU represents a conglomerate or Group of companies owned by union government of India or one of many state governments.

PSUs are not completely owned by the government but just a percentage. Usually it is between 50% - 70% commonly known as stake.

PSUs are very crucial to the economic growth of the country. They also generate millions of job opportunities every year.

Most of the top PSU companies in India are in banking and oil & energy sector.

Difference between a PSU and a Government Company

Most of the people think PSUs are same as government companies. But there is a difference between a PSU and a government company.

As I told in the earlier paragraph that PSU is managed and controlled by the central, state or local government. They don’t fully own the company but they have stakes in it. Like 50% stakes or 60% stakes. Not full!

However a government company is solely run under the state government or central government.

For example ONGC or Oil Natural Gas Corporation is the largest government owned PSU in India with 60% stakes owned by government of India.

On the other hand a company like HMT (Hindustan Machine Tool) is solely owned by government of India.

That’s the difference!

Why We Need PSUs?

A country like India with serious socio-economic and financial challenges needs PSUs. India still has insufficient industrial base, low investment, poor infrastructure, regional economic imbalance and a lot of unemployment.

Therefore PSUs can help India in addressing these challenges. The real intention behind establishing PSUs was to make India self reliant and contribute towards a steady economic growth.

PSU also helps in generating thousands of jobs. Every year millions of engineering aspirants apply for jobs in different PSUs.

If India wants to compete with the rest of the world then it needs PSUs that are generating profit every single year.

Broader Classification of PSUs

PSUs are classified into following categories

Strategic CPSE

Strategic Central Public Sector Enterprises include strategic companies that manufacture things like Arm and Ammunition and defense equipments, aircrafts and other defense related items like atomic energy, railways etc. Ordinance Factory, BEL, HAL are some examples.

Non Strategic CPSE

Non Strategic means PSU items that aren’t related to defense like BHEL or Bharat Heavy Electrical Limited, Power Supply etc.

Public Sector Banks

It means PSU banks that are under the direct control of either central government or state government. For example State Bank Of India (SBI) is owned by the central government of India.

State Level Public Enterprises (SLPEs)

SLPEs as the name suggest companies that are under the direct control of State government with a share ownership of 51% or more. Union government has no role in it.

Different Types of PSUs in India

There are three different types of PSUs in India. Companies are divided into these categories on the basis of their financial performance and growth.


Companies that qualify under Maharatna has to fulfill certain parameters like

  • It should be a Navratna company promoted to Maharatna.
  • The company should have annual turnover of Rs 20,000 crore and annual net worth of Rs 10,000 crore.
  • The company enables better control over finances and administrative matters.
  • Maharatna companies are free to decide on investment matters up to 15% of their net worth.

There are 8 Maharatna companies

  1. Bharat Heavy Electricals limited
  2. Bharat Petroleum Corporation Limited, BPCL
  3. Coal India Limited
  4. GAIL (India) Limited
  5. Indian Oil Corporation Limited
  6. NTPC Limited
  7. Oil & Natural Gas Corporation Limited
  8. Steel Authority of India Limited


Criteria for Navratna companies are

  • It should be a Mini Ratna category 1
  • Excellent or Very Good MoU ratings
  • Able to Invest upto 15% of their net worth
  • Can spend 30% of their net worth

There are 17 Navratna Companies

  1. Bharat Electronics Limited
  2. Bharat Petroleum Corporation Limited
  3. Container Corporation of India Limited
  4. Engineers India Limited
  5. Hindustan Aeronautics Limited
  6. Hindustan Petroleum Corporation Limited
  7. Mahanagar Telephone Nigam Limited
  8. National Aluminium Company Limited
  9. National Buildings Construction Corporation Limited
  10. NMDC Limited
  11. Neyveli Lignite Corporation Limited
  12. Oil India Limited
  13. Power Finance Corporation Limited
  14. Power Grid Corporation of India Limited
  15. Rashtriya Ispat Nigam Limited
  16. Rural Electrification Corporation Limited
  17. Shipping Corporation of India Limited


Mini Ratna can be divided into Category 1 and Category 2.

  • The amount of pretax profit should have been Rs 30 Crores.
  • Can enter into joint venture or set subsidiary companies.

There are more than 20 Mini Ratna Category 1 companies.  Some of them are

  1. Airports Authority of India
  2. Bharat Dynamics Limited
  3. Bharat Sanchar Nigam Limited
  4. Dredging Corporation of India Limited
  5. Goa Shipyard Limited
  6. Pawan Hans Helicopters Limited
  7. Mazagaon Dock Limited
  8. Housing & Urban Development Corporation Limited

These were some of the PSUs in India.

No of PSUs and Biggest PSUs in India

In total there are 277 Central Public Sector Undertakings in India.

The biggest PSUs are Maharatna according to their net worth are.

  • Oil & Natural Gas Corporation – Rs 62,296 Crore
  • Indian Oil – Rs 42,113 Crore
  • NTPC – Rs 20,000 Crore
  • Power Grid Corporation – Rs 19,625 Crore
  • Bharat Petroleum Corporation Limited or BPCL – Rs 17,000 Crore
  • Coal India – Rs 13,792.82 Crore
  • Hindustan Petroleum – Rs 13,000 Crore
  • GAIL (India) – Rs 8,500 Crore

Career is PSUs

PSUs in India are one of the best employment generators. Millions of engineering aspirants apply for PSU jobs for various vacancies.

PSU companies offer their employees excellent salary package, various perks and facilities.

Every company has their own eligibility criteria and recruitment process. There are 3 ways to get recruited.

  • Most of the PSUs recruit their candidates through GATE scores.
  • Some companies also recruit through NET.
  • Sometimes they have their own competitive exams for recruitment.

PSU Jobs

PSUs offer attractive salary package which could be between Rs 7 Lacs and Rs 20 Lacs per annum.

You will also get time-bound promotions and other perks & privileges’.

You will get free and full medical insurance for yourself and your family.

Moreover there is job security so you don’t have to worry about getting fired.

However getting a PSU job is very tough because of competition. It is very tough nut to crack.

This is all you need to know about PSUs in India. If you are an investor or a student I would recommend you to visit their website and find out more.

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