New Delhi: 1st Jan-2024, The Central Public Sector Enterprises (CPSEs) have completely outperformed the private sector companies in the year 2023 and added over Rs 20 lakh crore in the market capitalization.
According to a senior Investment Analyst with SBI Wealth, the large CPSEs have outsmarted the large-cap private giants by several times which is a testimony to the fact of the public confidence in these companies.
“The CPSEs are more controlled with at least five major watchdog bodies including Internal Audit, Vigilance, CVC, CBI etc., apart from the statutory audit,” the analyst said, adding, too many watchdogs always tend to slow down the operations.
But even in the face of tough challenges, even from the angle of borrowing funds from the banks and financial institutions, the CPSEs have broadly maintained their growth trajectory providing a solid impetus to the Indian economy.
The 2023 success story of the CPSEs will boost the morale of the investors to a large extent which will help lead the Indian economy to a newer heights, says another analyst with HDFC Bank, which is the second largest bank of the country.
As many as 103 listed CPSEs have outperformed the popular NiftyFifty index of the National Stock Exchange (NSE), which has registered a 20 per cent growth in 2023, first time in a decade.
Although the doomsayers had kept on preaching that the year 2023 would be a disastrous, particularly for the public sector which are groping with the ills of inefficiencies and cost overruns.
“But none of them had an iota of an idea as to how the Public Sector companies work under various challenges and uncanny pressures.
“It is not only the challenges that we are faced with typically, being a Public Sector entity. It is a litany of other issues including media apathy and misinformation, intentionally trumpeted by some vest interests in the business community, that we are fighting with our jaws clenched.” Said a retired Director of a large CPSE in the oil and gas sector.
“ CPSEs need a level playing field to compete with the private sector in this cut-throat world. People should be adequately informed so that they can bestow their unstinted supports to the Government owned companies, managed by the best professional talents,” he added.
Although the CPSEs have created this humongous wealth for the investors, the Price/Earnings ratio of all the companies are shockingly low when their counterparts in the private sector have very bloated ones.
“This means, the growth story for the CPSEs has only began. In 2024, I am quite confident that these growth figures will be much bigger in terms of market capitalization and performance.
During the year gone by, the CPSE ETF (Exchange Traded Funds) have witnessed a growth of over 73.80 per cent which is an all-time record in the capital market. The ETF, which has a constituents of 11 CPSEs, had a dream run within a range of 37.20-68.55 with the last NAV (Net Asset Value) clocked at 66.88, which is more than three times of NiftyFifty.
Interestingly, the CPSEs in the energy sector took the charge of firing sixers in the bourse providing a strong testimony to the Government of India’s mission toward energy transition and energy independence.
NewsIP will also cover each and every company’s performance and wish-list for 2024 in the subsequent coverage. Please stay tuned..