BHEL and SAIL Risk Maharatna Downgrade as Centre Reviews Underperforming PSUs
The Centre is understood to be closely reviewing the financial performance of BHEL and SAIL, both Maharatna CPSEs, with a possible downgrade to Navratna status on the table if profit benchmarks are not met within the next year.
New Delhi, June 2026: Two of India's most recognised heavy-industry Public Sector Undertakings — Bharat Heavy Electricals Limited (BHEL) and Steel Authority of India Limited (SAIL) — are reportedly facing heightened scrutiny from the central government over sustained underperformance against profitability benchmarks. Insider sources indicate that the government has set a one-year window within which both PSUs must demonstrate measurable improvement in their profit metrics, failing which they could be considered for a downgrade from their current Maharatna status to the lower Navratna category. The Maharatna status is the highest designation accorded to Central Public Sector Enterprises by the Government of India, conferring significant financial and operational autonomy — including the ability to invest up to Rs 5,000 crore in a single project without seeking government approval and freedom to establish joint ventures abroad. A downgrade to Navratna would substantially curtail these freedoms, limiting investment sanctioning to Rs 1,000 crore per project and reducing the operational latitude of their boards. For BHEL, the performance review comes against the backdrop of the company navigating a complex transition — attempting to leverage India's infrastructure build-out and the energy transition opportunity while dealing with an ageing order book structure and competition from private players in the power sector. For SAIL, the challenge is partly structural: global steel oversupply, compressed steel margins, and a complex competitive landscape with private majors like Tata Steel and JSW Steel have kept profitability under stress. Both companies enjoy large workforces and strategic national mandates, which makes any downgrade politically and administratively complex to execute. However, the signal from North Block appears to be unambiguous: the government's patience with underperformance at its flagship PSUs is wearing thin, and the Maharatna umbrella can no longer be assumed as a perpetual protection against accountability for financial outcomes.
