THE PSU JUGGERNAUT ROLLS ON

COMPANIES OWNED BY THE GOVERNMENT HAVE BEEN ON A TEAR WITH PROFITS RISING 40% IN FY24. THE DREAM RUN CONTINUES IN SPITE OF GLOBAL CHALLENGES.

- ASHUTOSH KUMAR

ATMANIRBHAR BHARAT
BANKS TACKLE BAD LOANS
COMMODITY SUPERCYCLE
CENTRE'S BIG CAPEX PUSH

THE CENTRE’S policy of self-reliance, Atmanirbhar Bharat, rolled out in May 2020, followed by the defence ministry’s decision to localise procurement, fired up the dormant behemoths of the Indian economy—public sector undertakings (PSUs). Industrial goods and defence PSUs were the first to roll out mega investments. In 2021, with the government announcing a huge increase in capital spending, infrastructure PSUs, especially those under the railway ministry, joined the party. The mega commodity supercycle pushed up prices of steel and other metals and benefited metal PSUs. A combination of pre-Covid banking reforms, postCovid economic recovery, pent-up demand and low interest rates ensured the PSUs were on a roll. The 68 PSUs in the Fortune 500 India list logged a total income of ₹56.14 lakh crore in FY24, from ₹53.79 lakh crore in FY23, while profits grew 40% to ₹5.03 lakh crore.

Led by State Bank of India (SBI), the government banks in the list accounted for one-third of the profits—₹1,50,691 crore—compared with ₹1,12,606 crore in FY23. SBI accounted for almost half the profits of the PSU banks at ₹67,085 crore, compared with ₹55,648 crore in FY23. The total income of government banks was ₹13.73 lakh crore in FY24, compared with ₹11 lakh crore in FY23.