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IRCTC and IRFC Achieve ‘Navratna’ Status
Context:
The Government of India has conferred the prestigious ‘Navratna’ status upon two prominent public sector undertakings (PSUs) in the railway sector—Indian Railway Catering and Tourism Corporation (IRCTC) and Indian Railway Finance Corporation (IRFC).
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- This announcement was made on March 3, 2025, marking a momentous achievement for these organisations. They became the 25th and 26th Navratna companies of India.
- With this, all seven listed Central Public Sector Enterprises (CPSEs) under Indian Railways now hold Navratna status.
Financial Performance of IRCTC and IRFC
- IRCTC: The company reported an impressive annual turnover of Rs 4,270.18 crore, Profit After Tax (PAT) of Rs 1,111.26 crore, and a net worth of Rs 3,229.97 crore. These strong financial results helped propel IRCTC to the elite ‘Navratna’ status.
- IRFC: Similarly, IRFC, another Ministry of Railways PSU, has excelled in its financials. In FY 2023-24, the corporation achieved a robust annual turnover of Rs 26,644 crore, PAT of Rs 6,412 crore, and an impressive net worth of Rs 49,178 crore.
What is Maharatna, Navratna and Miniratna Status?
- Maharatnas: The term “Maharatna”, meaning “a great jewel”, highlights the immense value these companies hold for both the nation and on a global scale.
- Eligibility Criteria: It must hold a Navratna status.
- Its stocks must be listed on the Indian Stock Exchange with the minimum required public shareholding according to SEBI regulations.
- The enterprise should have an average annual turnover exceeding ₹25,000 crore over the last three years.
- Its average net worth over the previous three years must be ₹15,000 crores.
- Over the past 3 years, it must have made a profit after taxes of at least ₹5,000 crores.
- The enterprise must operate internationally and have a notable global presence.
- Navratnas: It is a public sector undertaking in India that has been granted Navratna status. These companies are given authority in areas such as capital expenditure, investment in joint ventures or subsidiaries and human resources management.
- Eligibility Criteria: It must hold a Navratna status.
- Eligibility Criteria: The company should already hold the Miniratna Category I status and be listed under Schedule A of CPSEs.
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- It must have consistently received an outstanding rating under the Memorandum of Understanding System for at least three out of the last five years.
- The company needs to meet specific criteria across six key areas.
- Including net profit to net worth, PBDIT to capital employed, gross margin as capital expenditure, manpower cost to cost of production or services, gross profit as turnover, and earnings per share.
- Miniratnas: They excel in operations and maintain financial stability, crucially impacting sectors such as telecommunications, aviation, defence, and engineering.
- Eligibility Criteria:
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- Category I: A company must have consistently recorded profits for the past three years.
- It must have earned a pre-tax profit of at least ₹30 crore in the last three years or maintained an average annual turnover of at least ₹120 crore over the same period.
- Category II: Companies must have made profits in the last three years. They must have also achieved a pre-tax profit of at least ₹20 crore in one of those years or sustained an average yearly revenue of at least ₹80 crore during the last three years.
- Category I: A company must have consistently recorded profits for the past three years.
Key Benefits of ‘Navratna’ Status
- Investment Flexibility: Companies with ‘Navratna’ status can invest up to Rs 1,000 crore or 15% of their net worth in a single project without requiring prior approval from the central government.
- Operational Freedom: This status provides PSUs with increased flexibility to expand operations and explore new business avenues, thereby encouraging innovation and growth.
- Autonomy in Strategic Decisions: ‘Navratna’ PSUs gain greater independence in forming joint ventures, entering into technology or marketing agreements, and pursuing strategic partnerships.
- Competitiveness and Self-Sufficiency: The ‘Navratna’ recognition aims to bolster the overall competitiveness and self-sufficiency of public sector enterprises. By offering more control over investments and strategic decisions, it empowers these companies to compete more effectively in both domestic and international markets.
Other Navratnas of Indian Railways
- Before IRCTC and IRFC, five other Indian Railways CPSEs had already achieved Navratna status. These include:
- Container Corporation of India (CONCOR) – A multimodal logistics company for freight transport. The first Indian Railways company to achieve Navratna status in July 2014.
- Rail Vikas Nigam Ltd (RVNL) – Focused on creating and augmenting railway infrastructure.
- RITES Ltd – A multidisciplinary consultancy in transport infrastructure.
- IRCON International Ltd – Specialises in building railways and highways projects.
- RailTel Corporation of India Ltd – Provides connectivity services, including IP-based video surveillance and NIC e-Office services.
