‘225% growth in market cap’: Nirmala Sitharaman hits out at Rahul Gandhi, Congress with 10 point counter on PSU performance

Finance Minister Nirmala Sitharaman, has hit out at the opposition’s claims of Public Sector Undertakings (PSUs) being in disarray under Narendra Modi government, by listing 10 points on the performance of these entities.

In a post on X (formerly Twitter), Sitharaman has said that the collective market capitalization of the 81 publicly traded PSUs has experienced a remarkable 225% growth under the Modi government. Additionally, the Nifty CPSE index has delivered an impressive 79% return, significantly outperforming both the Nifty 500 and Nifty 50 indices.

Sitharaman’s post was a response to allegations made by the Indian National Congress (INC) and its leader Rahul Gandhi, who claimed that PSUs were being dismantled and were in disarray under the Modi government. The Finance Minister referred to these claims as a prime example of “Ulta Chor Kotwal Ko Daante,” suggesting that the facts paint a different picture.

According to the data provided by Sitharaman, 62 CPSEs, 12 PSBs, 3 public sector insurance companies, and IDBI Bank have witnessed a substantial 225% increase in their market capitalization. Furthermore, the NIFTY CPSE index has outperformed both the NIFTY 500 and NIFTY 50 indices, which have yielded returns of 27.4% and 22.5%, respectively.

Here are the 10 points FM Nirmala Sitharaman listed to counter Rahul Gandhi and INC’s charges:

1. Total Paid-up Capital of all CPSEs was Rs 5.05 lakh crore as of March 31, 2023, v/s Rs 1.98 lakh crores in FY 14, an increase of 155%.
2. Total Gross Revenue from the operations of CPSEs during FY 2023 was Rs 37.90 lakh crore v/s Rs 20.61 lakh crore in FY 14, an increase of 84%.
3. Net Profit of profit-making CPSEs stood at Rs 2.41 lakh crore in FY 2023 v/s Rs 1.29 lakh crore in FY14, an increase of 87%.
4. 4. Contribution of all CPSEs to the Exchequer by way of Excise & Customs duties, GST, Corporate tax, Dividends, etc. stood at Rsv4.58 lakh crore in FY 2023 v/s Rs 2.20 lakh crore in FY14, an increase of 108%.
5. Net Worth of all CPSEs increased from Rs 9.5 lakh crore as of March 31, 2014, to Rs 17.33 lakh crore as of FY-2023, an increase of 82%.
6. Capital Employed by all CPSEs was Rs 38.16 lakh crore as of March 31, 2023, against Rs 17.44 lakh crore as of March 31, 2014, a growth of 119%.
7. Total market cap of all 81 listed PSUs (62 CPSEs, 12 PSBs, 3 Public Sector Insurance Companies and IDBI Bank) has grown by 225%.
8. Returns by NIFTY CPSE of nearly 78.8% have significantly outpaced NIFTY 500 (27.4%) and NIFTY 50 (22.5%)
9. Market Cap of 12 listed Public Sector Banks (PSBs) has increased 2.95 times (195%) from Rs. 5.45 lakh crore (as of 31.3.21) to Rs. 16.12 lakh crore (as of 31.3.24).
10. Notably, 15 CPSEs have experienced an impressive CAGR ranging from 76% to 100%, reflecting substantial value appreciation and investor confidence. Additionally, 25 CPSEs have demonstrated strong growth with CAGR ranging between 51% to 75%, while 28 CPSEs have shown steady expansion within the range of 26% to 50%.

Sitharaman said that PSUs had suffered under the previous Congress-led UPA government and were neglected. However, under the Modi government, companies like Hindustan Aeronautics Limited (HAL) have experienced a resurgence, delivering multibagger returns of an impressive 1,000% over the last five years, she claimed.

Sitharaman attributed the success of PSUs to the “culture of professionalism infused in them along with increased operational freedom” under the Modi government. She also highlighted the government’s focus on capital expenditure, which has directly benefited PSUs in various sectors such as railways, roads, power, metals, construction, and heavy equipment manufacturing.

Addressing Rahul Gandhi’s criticism of HAL, the Finance Minister stated that contrary to his claims, HAL’s market valuation has skyrocketed by 1370% in just four years, increasing from Rs 17,398 crore in 2020 to Rs 2.5 lakh crore as of May 7, 2024.

Moreover, HAL announced its highest-ever revenue of more than Rs 29,810 crore for FY 2023-24 and boasts a robust order book exceeding Rs 94,000 crore. Sitharaman argued that these figures indicate a strengthening institution rather than a weakening one.

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