In an update shared on social media platform X, Finance Minister Nirmala Sitharaman highlighted the thriving state of state-run companies under Prime Minister Narendra Modi's guidance. She emphasized the government's emphasis on capital spending and infrastructure development as key factors behind the significant growth in these companies' stock performance.
Sitharaman noted a substantial rise in the share prices of public sector undertakings (PSUs) over the past three years, attributing this growth to improved management practices and increased operational autonomy. She pointed out that the combined market capitalization of all 81 listed PSUs, including central public sector enterprises (CPSEs), public sector banks (PSBs), and public sector insurance companies, along with IDBI Bank, has surged by 225% during this period.
Highlighting the positive trend, Sitharaman revealed that the net worth of CPSEs has surged by 82%, reaching Rs. 17.33 lakh crore in the fiscal year 2022-23, compared to Rs. 9.5 lakh crore in March 2014.
She attributed this success to various measures undertaken by the government, including aligning management incentives, implementing capital management guidelines on dividends and buybacks, and refining the disinvestment strategy. According to Sitharaman, these actions have not only enhanced the performance of CPSEs but also instilled confidence among investors.
Sitharaman pointed out impressive growth rates among CPSEs, with 15 companies achieving a compounded annual growth rate (CAGR) ranging from 76% to 100%, and 25 companies showing strong growth with a CAGR between 51% to 75%. Additionally, 28 CPSEs demonstrated steady expansion with a CAGR within the range of 26% to 50%.
She also highlighted the remarkable increase in the market capitalization of 12 listed PSBs, which surged by 195% from Rs. 5.45 lakh crore in March 2021 to Rs. 16.12 lakh crore in March 2024.
Sitharaman contrasted the performance of PSUs under the current government with that under the previous Congress-led UPA government. She claimed that PSUs like Hindustan Aeronautics (HAL) experienced neglect during the UPA regime but have seen a resurgence under Modi's leadership.
Moreover, Sitharaman compared the performance of PSU stocks during the NDA and UPA governments, highlighting significant growth during the former's tenure. She emphasized the positive impact of increased defense spending and the government's focus on achieving self-reliance in defense, which has fueled the growth of PSUs like Bharat Electronics Ltd (BEL), HAL, and Mazagon Dock.
Overall, Sitharaman's remarks underscored the remarkable progress made by state-managed companies under PM Modi's leadership, with significant strides in market performance and investor confidence.
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