Chapter - V Summary, Findings, Conclusions, and Recommendations

Transcription

1 Chapter - V Summary, Findings, Conclusions, and Recommendations This Chapter is divided in to four different parts. i.e. i) A brief summary of the study, ii) Major Conclusions derived after analysis of all sample companies from various aspects as per the research design, iii) Important findings & suggestions and iv) Proper recommendations. It also focuses on further scope for the research and its contribution to the society. I. Summary Of The Study: First chapter of the study concerned with the evolution of Public Sector Undertakings, features of various Industrial Policy Resolution and the approaches of these policies towards Public Sector Undertakings including policy of De Reservations in New Economic Policy of 1991 and Policy for Navratnas and Miniratnas status Public Sector Undertakings after New Economic Policy1991 in detail. This chapter also focus on the growth rate of Public Sector Undertakings in terms of numbers units and amount invested along with Significance of the Study, Scope and Limitations, Objectives, Hypothesis to be tested and Research Methodology to be adapted in this study. Second chapter of the study focussed on Review of Literature on the current scenario. The literature review has been taken from various research papers, reputed journals and books. In order to have a better clarification of the literature review, the study has been classified into four major heads named Evolution and Performance of Public Sector Enterprise s in India, Disinvestment and Privatisation, Memorandum of Understanding and Measures of Financial Performance respectively. In this research every attempt has been made to inculcate almost all relevant literature review comes under these four heads as per the research design. 147

2 A Nation in Transition: Understanding the Indian Economy by Jayshree.Sengupta, Can Two Wrongs Make a Right? State Ownership and Debt in an Evolution Economy by Trien Vinh Le and Jonathan P. Brien, Disinvestment Manual by Department of Disinvestment, Welfare Consequences of Selling Public Enterprises: An Empirical Analysis by Galal Ahmed Leroy Jones, Pankaj Tandon and Ingo Vogelsang, Composite criteria for MoU. By Nagaraj, Case studies of Indian reforms by Sangeetha and Development of Organisation and competencies by Saroj Kaul are few amongst them. The third chapter Financial Analysis of Selected Companies provides a brief introduction of all the sample companies along with the analysis of financial performance indicators and its comparisons during the Pre and Post Revamped region. Pre revamped regime considered as a period of six years starting from 2000 to 2005 and Post revamped regime is of six years starting from 2005 to The focal point of this chapter is on assessment of the financial performance of selected Indian Public Sector Enterprises along with its comparative analysis during Pre and Post revamped MoU period. For comparative analysis of financial performance this research has been carried out through the Wilcoxon signed rank test which is non parametric test. Among the other types of non parametric analysis this method is most suitable because it involves difference between dependant groups [the variables are dependent to each other and they are taken from the same sample]. The variation between two study periods has been examined to test the hypotheses. The key financial parameters used for this study are Sales Growth, Assets Growth, Net Profit Margin, ROI & ROE, Current Ratio, Working Capital, capital Structure, Earnings per Share, Operating Cash Flow / Net Sales and Dividend per Share. The fourth chapter - Analysis of Non Financial Parameters stands for analysing the qualitative aspects of the sample companies during the pre and post revamped regime. As per research design qualitative aspects has been analysed through SWOT analysis and the competitiveness & efficiency test framed as per the research design. Thus in short this chapter focused the SWOT Analysis of sample companies based on Macro Perspectives and Competitiveness & efficiency test based on templates developed during the pre and post revamped region for Actual Average and Three year rolling average. 148

3 The Fifth Chapter conclusion, suggestions and recommendations is divided in to four different parts. i.e. i) A brief summary of the study, ii) Major Conclusions derived after analysis of all sample companies from various aspects as per the research design, iii) Important findings & suggestions and iv) Proper recommendations. It also focuses on further scope for the research and its contribution to the society. II. Major Conclusions Major conclusions of the research are mentioned in the following table: Table No: 5.1 Major Conclusions of the Research I. Analysis of Financial Parameters: A) Key Financial Parameters 1. Sales Growth 2. Assets Growth 3. Net Profit Margin Performance of Sample Companies (BPCL, HPCL and SCIL) Pre revamped regime recorded a declining trend in sales growth in case of all the sample companies. As compared to other sample companies BPCL recorded its ever poor growth rate of 10.7% decline in sales. (Refer Figure: 3.1) Even though during the Post revamped regime all the sample companies recorded considerable growth rate in its assets value HPCL s growth rate was highest (i.e %) as compared to other sample companies. (Refer Figure: 3.13) Net Profit Margin of sample companies behaved differently during the post revamped regime. Due to international price crises BPCL recorded its Net Profit Margin weakly. Its ever highest of the era was 1.76% as against 2.63% during the pre revamped regime. (Refer Figure: 3.3) 149

4 A] Key Financial Parameters 4. ROI & ROE 5. Current Ratio 6. Working Capital 7. Capital Structure 8. Earnings Per Share Performance of Sample Companies (BPCL, HPCL and SCIL) ROI & ROE of the sample companies too behaved differently during the post revamped regime. Only in case of HPCL it recorded moderate growth rate (ROE varied from 24.5% to 36.1%) and in rest of the case it was declining moderately. (Refer Figure: 3.15) Post revamped regime recorded efficient cash and working capital management of sample companies. During this era it was stale and moderately improving. For BPCL & HPCL this ratio was in between 1:1 to 1:4 where as for SCIL it was in between 2:8 to 3:2. (Refer Figure: 3.5, Figure 3.16 and Figure 3.27) Working capital of the sample companies increased more sharply during the post revamped period as the business portfolio of the companies started growing more rapidly. Among the sample companies BPCL recorded its ever highest growth rate as 33% in (Refer Figure: 3.6) In case of BPCL & HPCL debt ratio was high during the post revamped regime. As per management discussion and analysis report these companies adopted a policy of improving earnings per share through leverage due to lowest profit. SCI lowered its debt ratio in this era. (Refer Figure: 3.7 Figure: 3.18 and Figure: 3.29). In the post revamped regime excluding SCI rest of the sample companies earning per share was low due to lower net profit margin. In 2006 BPCL recorded its ever poor EPS of Rs During this year BPCL significantly increased its turnover but according to management its profit after tax was pitiable. (Refer Figure: 3.8 and Figure: 3.30) 150

5 A] Key Financial Parameters Performance of Sample Companies (BPCL, HPCL and SCIL) 9. Operating Cash Flow/ Sales Operating Cash Flow/Sales of all the sample companies were poor during the post revamped regime due to challenges and changes in the external environment. SCI recorded 27.1% as its highest Operating Cash Flow/Sales where as its lowest record of the era was 13.4%. (Refer Figure: 3.32) 10. Dividend Per Share During the post revamped regime DPS trend line were almost symmetrical for all sample companies. Even though its payout ratio was poor due to lower Net Profit Margin BPCL & HPCL improved this situation by the end of the era. When BPCL recorded highest DPS as Rs (Lowest Rs.4.00) HPCL recorded Rs.18 as the Highest and Rs.3.00 as the Lowest of the era. (Refer Figure: 3.9 and Figure: 3.20) B) Non Parametric Analysis Non Parametric Analysis through Wilcoxon Signed Rank Test proves that the sample companies significantly enhanced its performance during the post revamped era. 151

6 II. Non Financial Parameters Analysis of Sample Companies: Pre Revamped Period Post Revamped Period Strength of this era was Modernised internal system by the S-Strength assured ROI, protection of Market shares and Declining use of technology & internet, Abolition of market share protection risk of cost by reimbursement scheme and the attitude of risk averter strategy. (Refer Figure: 4.1) from risk taker. (Refer Figure: 4.2) Failed to balance with 1. SWOT Analysis W- Weakness international market, inadequacy of improvement in products and services, high interference of govt. In fiscal policies and lack of motivation for higher efficiency. (Refer Figure: 4.1) Economic growth, investments Non attractiveness of New Exploration Licensing Policy by major international organisations and lack of technological development. (Refer Figure: 4.2) Latest automation for diminishing O - Opportunit ies in equity assets in abroad, modernising the internal system by the use of technology and internet. (Refer costs, investments in CNG and PNG projects and better prospects in Coal Bed Methane and Shale gas. (Refer Figure: 4.2) Figure: 4.1) T- Threat Highly competitive Environment, Diminishing production rates and lack of innovations. (Refer Figure: 4.1) Latest discoveries are not commendable, lack of technological know-how as compared to international market players and international market fluctuations. (Refer Figure: 4.2) 152

7 Performance of Sample Companies (BPCL, HPCL and SCIL) 2. Efficiency Test The post revamped regime recorded a higher efficiency rate in case of HPCL and SCIL. If HPCL recorded 44.70% increase in efficiency growth rate, SCIL s results shows 14.17%. Only BPCL recorded negligible decline (i.e %) in efficiency growth rate test. (Refer Figure: 5.1) 3.Competency test Competency test too proved that post revamped regime shows higher competency in all the sample companies. BPCL recorded a negligible improvement of Competitiveness (i.e. 0.91%), HPCL s competency growth rate raised by 28.99% and the SCIL recorded 21.03% improvement in the competency growth rate test. (Refer Figure: 5.2) III. Important Findings & Suggestions: Hypothesis Tested: H-1) Public Sector Undertakings were handicapped during the Pre revamped Scenario and were not in a position to grow as fast as global majors. The pre Revamped Regime ( ) was an era of much government interference for Public Sector Enterprises. During this period especially in case of oil industries government adapted Cost Plus formula with the guarantee of 12% after tax return on net worth. This worked as a shield against international price fluctuations for these companies. Because of political influence price charged by these companies were drastically lower than the international market from where they have to buy. The guaranteed Cost Plus formula helped 153

8 the Public Sector Enterprises to maintain its health by creating a lot of financial burden to the government. If at least international price was made available then these companies could have earned enough surpluses. The financial analysis 126 during the pre Revamped Regime also reveals the same picture. The non parametric test analysis as mentioned in the research design also supports this hypothesis. In short, Pre Revamped Regime, i.e. the period covering from , as mentioned earlier, was an era of organic growth led by the economic scenario and initiatives put forward by government of India towards the Public Sector Undertakings. Thus the first hypothesis Public Sector Undertakings were handicapped during the Pre revamped Scenario and were not in a position to grow as fast as global majors. is established or proved. After Disinvestment, Memorandum of Understanding with Balance Score Card system was the major techniques of economic reforms to be claimed for the better performance of Public Sector Enterprises by Government. The following hypotheses are validated based on this criterion: H-2) The financial performance of Public Sector Undertakings in the Post Disinvestment Scenario is higher. The financial performance evaluation of the sample companies were made to give comparative image of performance during these two study periods by developing some financial parameters and with some qualitative factors. The financial parameter for the study are Sales, Assets, Net Profit Margin, Return on Investment & Return on Equity, Current Ratio, Working Capital, Capital Structure, Earnings Per Share, Dividend Per Share and Operating Cash Flow / Net Sales. Variability and relationship of these financial parameters shows that the performances during the two study period are not similar. It is proved in the third chapter Financial Analysis that the sample companies boosted their financial health during the Post Revamped Regime than the Pre Revamped Regime. Hence this reinforces the consideration of second hypothesis that The financial performance of Public Sector Undertakings in the Post Disinvestment Scenario is higher. 154

9 H-3) The performance of MoU Public Sector Undertakings has rapidly improved over a period of time. In the previous chapters overall performances of the MoU Public Sector Undertakings during the two study periods are evaluated as per the research design through the analysis of various qualitative and quantitative aspects. The quantitative aspects discussed in the third chapter proved that the performancee of MoU Public Sector Undertakings were improved their efficiency during the post revamped period. The following diagram of the sample companies will clarify this concept: Figure: 5.1 Efficiency of Sample Companies 20.00% 15.00% 12.95% 10.26% 16.45% 8.87% 14.41% 10.00% 5.00% 6.13% 0.00% BPCL HPCL SCIL Pre Revamped Regime Post Revamped Regime Source: Combined diagram based on Chapter III, Financial Analysis. Chapter fourth concerned with the analysis of qualitative aspects. All these comparative analysis of the sample companies concludes that the performance of MoU Public Sector Undertakings has rapidly improved during the post revamped regime. Thus it s established that The performance of MoU Public Sector Undertakings has rapidly improved over a period of time. 155

10 H-4) The revitalization in MoUs with government enhanced competency of Public Sector Enterprises and there by the socio economic conditions of the society. All the sample companies have presented comparatively better financial performance during the post revamped period i.e. after the revitalization in MoUs with government. Even though the performance was good, it lacks the level where it was to be due to price control implemented by the government. This led the sample companies to subsidy trouble and under recovery problems. The non parametric test conducted in the third topic reveals that the sample companies performed differently during the two study periods. The following summarised table will clarify the concept: Company Table 5:2 Non Parametric Test Summary Performance Comparison Era Test Value Result Conclusion BPCL Pre Revamped Regime ( ) Post Revamped Regime ( ) W 4 Reject H0 BPCL performed differently during the two study periods. HPCL SCIL Pre Revamped Regime ( ) Pre Revamped Regime ( ) Post Revamped Regime ( ) Post Revamped Regime ( ) W 4 W 4 Reject H0 Reject H0 HPCL performed differently during the two study periods. SCIL performed differently during the two study periods. Source: Combined diagram based on Chapter III, Financial Analysis 156

11 The performance of sample companies in the post revamped region was comparatively better than pre revamped region and the financial health of these organisations were also improved during this era. Apart from this, the efficiency and competitiveness test performed on the basis of templates developed in the third chapter also support that the efficiency and competitiveness of the sample companies were improved during post revamped regime than pre revamped regime. This strengthens our fourth hypothesis i.e. The revitalization in MoUs with government enhanced competency of Public Sector Enterprises. The following figure will throw much more clarity towards this: Figure: 5.2 Competitiveness of Sample Companies 11.80% 12.00% 10.00% 8.00% 7.71% 7.78% 6.63% 9.75% 6.00% 5.14% 4.00% 2.00% 0.00% BPCL HPCL SCIL Pre Revamped Regime Post Revamped Regime Source: Combined diagram based on Chapter III, Financial Analysis. So far as the socio economic conditions of the society, Public Sector Enterprises were established to achieve purposes like uprooting unemployment problem through bridging the industrial gap, promoting balanced regional development, to provide 157

12 contribution to exchequer, reducing concentration of economic power in the private hands, increasing the speed of public control over the national economy and above all to promote a socialistic pattern of society. When the government made revitalisation in MoU, the Public Sector Enterprises enhanced their efficiency (i.e. during Post Revamped Period the sample companies enhanced financial health, competitiveness and efficiency). This has been proved through various qualitative and quantitative analysis held in third Chapter and fourth Chapter. Hence it s established that if revitalisations in MoU enhance the efficiency of Public Sector Enterprises then it will automatically improve the socio economic conditions of the society for which they have been established. IV. Overall Recommendations: 1. During the pre revamped regime government of India adapted returns on cost plus formula as their strategy in the sample company s. The research shows that this strategy neither helped to encourage nor improved the efficiencies of sample companies operations. 2. Because of the guaranteed return by the government (returns on cost plus formula) in pre revamped regime industry had an attitude of self satisfaction among the competitors. 3. The pre revamped regime witnessed an anti competitive environment and lack of innovative product line or services. Especially in oil and gas industry there were no major discoveries. 4. The research shows that during pre revamped era, the sample companies were in declining trend of intrinsic value due to increasing manufacturing cost, low field productivity and many other external environmental factors. 5. This study shows that the growth during pre revamped regime was organic. The progress shown by these sample companies were due to the initiatives taken by government and the impact of economic scenario. 158

13 6. As compared to the post revamped regime the growth rate of sample companies during pre revamped regime was very slow. 7. The study shows that during the post revamped regime the industry had plenty of opportunities for enhanced performance and higher efficiency, implementing customer oriented strategies and for customization of products and services. 8. Anticipating the necessity of paradigm shift required to be taken to sustain in the globalised era, the sample companies undertook various measures to make themselves to be ready for strong competition from private and international markets. 9. This study also reveals that the sample companies adopted various strategies, enhanced diversity, productivity, operating scale and customer satisfaction techniques. This will help to further improve their efficiencies in the post revamped regime. 10. During the pre revamped regime Hindustan Petroleum Corporation and Bharat Petroleum Corporation were operating 1 st or 2 nd generation refineries, producing only certain type product line with specific quality as per the requirement of that period. 11. The study reveals that because of improved financial health during the post revamped era, the sample companies pursued to invest or to boost their investment in fixed assets. 12. This study shows that during pre revamped era, the sample companies were not in a position to take challenges in accordance with future trend and rapid economic growth. 13. In the Pre revamped regime the procedure of technological adaptation was very slow and not in accordance with the trend of technological advances. 14. The results during the study period shows that the sample companies with revitalised MoU also enhanced their competitiveness during the post revamped regime. 15. The study also reveals that the sample companies with revitalised MoU not only enhanced the financial health and competitiveness but also improved their efficiency during the post revamped regime. 159

14 Scope for Further Research: According to my perception, further research can be taken in the following areas: Being a research based on Navratna Status Public Sector Undertakings further research can be done on sector based industries rather than status based. For example service sector or manufacturing sector etc. As observed in this study further research can be done on portfolio to ascertain whether these schemes shaped or shattered the intrinsic or core values of the business. Concluding Remark: Amongst the various economic reforms initiated by the government of India, Nehruvian Model was considered to be the milestone for Public Sector Undertakings. By the implementation of this model Public Sector had much importance in Indian economy. Its growth either in number of units or in the amount of investments or mode of operations was tremendous (Refer Figure: 1.1 and Figure: 1.2). But by the end of late nineties the situation of Indian economy were changed. Critical shortage of official reserves, huge deficits in balance of payments and sharp decline in GDP growth forced the Indian government to take corrective measures. Reforming the Public Sector of the country was one amongst them. Devastation of Public Sector Undertakings is impracticable one. Because various studies by economist magazine reveal that a country cannot maintain its economic growth rate without Public Sector undertakings. Apart from this if we consider the peculiar power of Public Sector undertakings in both the procurement & maximum utilization of short-term as well as long term financial resources as in case of Indian PSU banks the facts will be much clearer that Indian economy could not drop Public Sector Enterprises. Considering the importance of these organisations then the government of India started its economic reform by dismantling inspector raj system. i.e, reformative initiatives started by 160

15 cutting of industries reserved for public sector undertakings. Disinvestment of public sector undertakings, rising up of some highly successful public enterprises to the special status of Navratnas/ Miniratna depending on their eligibility by assigning superior financial powers and Memorandum of Understanding with Balance Score Card system was some among them. After Disinvestment, Memorandum of Understanding with Balance Score Card system was the major techniques of economic reforms to be claimed for the better performance of Public Sector Enterprises by Government. So the Disinvestment and Memorandum of Understanding were considered to be the two major economic reforms ever introduced by Government on Public Sector Undertakings. The present study mainly aimed to carry out a comparative analysis of the Pre and Post revamped Regime of selected Public Sector Undertakings during major economic reforms (i.e performance of Public Sector Undertakings before and after MoU with Balance Score Card system) on the basis of the latest financial data, to know how far the economic reforms was helpful to improve the operational efficiency and profitability of Public Sector undertakings in India and to know the impact of these reforms undertaken in Public Sector Undertakings on the socio-economic development of Maharashtra state. A brief profile of all the sample companies and their financial performances on selected parameters were reviewed for the enrichment of the study and for drawing the inferences according to the hypotheses formulated. All the data and information have been classified equally in to two distinct periods from 2000 to 2011 for addressing the objectives and to test hypotheses. For this purpose, Research Methodology adapted relates to qualitative and quantitative analysis of the Navratna Status Public Sector Undertakings (selected PSUS) belongs to Maharashtra State. A comparative analysis of these two periods will give a clear picture of the financial Performance during the Pre revamped MoU Period (from 2000 to 2005) and the Post revamped MoU Period (from 2005 to 2011). As mentioned in objectives and hypotheses even though the focal point is on assessment of financial performance of selected Indian Public Sector Enterprises during Pre and Post revamped MoU period this study also consider various qualitative factors ( non financial parameters) along with the following key financial parameters (Sales Growth, Asset Growth, Net Profit Margin, Capital Structure, 161

16 Liquidity, Working Capital, Operating Cash Flow, Earnings per Share and Return on Investment and Equity) to analyze and draw the conclusion. To derive at meaningful conclusion publicly available historical records, such as Annual Reports, financial statements, ratio analysis etc., of the sample companies various relevant ratios and statistical tools have been applied against selected parameters. While commenting on the performance of sample Public Sector Undertakings during the two study periods i.e. Pre revamped MoU period (from 2000 to 2005) and post revamped MoU period (2005 to 2011), both, rolling averages (3-years) as well as absolute figures were measured. Since the research mainly focuses on the assessment of financial performance during Pre and the Post revamped MoU Period, the data used for analysis selected primarily from Balance Sheet, Profit & Loss Statements and Cash Flow Statements of Navratna Status public sector enterprises from Maharashtra state. Apart from this, for total data, Annual Reports of sample companies for the significant period and PSU database were used. In this study it was expected that Post revamped MoU period will lead to raise in profitability, enhance competitiveness and efficiency. The main aim of this study is to find out whether the envisaged goal or expectations was achieved. For the comparative analysis of financial performance of the sample Public Sector Enterprises, this research has been carried out through the Wilcoxon signed rank test which is non parametric test. Among the other types of non parametric analysis this method is most suitable because this involves difference between dependant groups [the variables are dependent to each other and they are taken from the same sample]. The variation between two study periods has been examined to test the hypotheses. This research also focussed on major research works and their conclusion, for instance the performance of Public Sector Enterprises, Disinvestment, Memorandum of Understandings and measures of financial performances etc. The studies relating to financial performance of Public Sector Enterprises, their contribution towards the financial development of the nation, problems faced for the economic development and measures to be adopted along with recommendations to get better performance are included in sub-head. 162

17 The performances of all Navratna Status Public Sector Enterprises within Maharashtra State have analysed through quantitative and qualitative aspects. The Wilcoxon signed rank test has been used to draw the results of quantitative aspects during the Pre and Post revamped MoU period. For qualitative aspects, the study has been divided in to two parts. The first part is concerned with Strength, Weakness, Opportunities, and Threat analysis and the second part is competitiveness & efficiency test. Certain templates have been created for assessing the competitiveness and efficiency factors for analyzing the data to know if competitiveness and efficiency have enhanced during post revamped MoU period compared to Pre revamped MoU period. Competitiveness is based on the assumptions that it is the gathering of three major variables (assets, performance and processes). 100% score assigned to Competitiveness was further dispersed amongst its key variables i.e. the assets, performance and processes with 33.33%. There after these key variables are divided to related financial parameters for the study. For example, overall performance of the Company mainly depends on its Assets growth so % score assigned to asset growth. Performance depicts by sales growth and net profit margin so 16.67% assigned to concerned element of the parameter on equivalent basis. As in the same way, Current Ratio & Operating Cash Flow/Net Sales Ratio assumed as part of financial orbit processes and is vested with 16.67% for each. The efficiency test is based on the assumptions that the existence of a company depends on its size, research & development, and the internal system. So the score of 100% divided among the financial parameters leading towards its efficiency as, the size, internal systems and other parameters of 33.33% each. Then the individual financial parameters are sub divided to corresponding financial parameters. For example, Asset Growth is the only sub element of size so % weight age is allocated to asset growth. Parameters other than Size and Internal System influencing efficiency of a Company can be assigned in terms of sales growth and net profit margin (which comes under Other Parameters with 33.33% 163

18 Score). Being sub element of other parameters, 16.67% assigned to each as part of other parameters. As in the same mode, the scores of Internal System have been diversified between Return on Investment and Operating cash flow/net Sales ratio of 16.67% each as the factors influencing efficiency of organization. The quantitative aspects test results proves that Pre Revamped Regime, i.e. the period covering from , was an era of organic growth led by the economic scenario and initiatives put forward by government of India towards the Public Sector Undertakings. The variability and relationship of the financial parameters shows that the performances during the two study period are not similar. The same has been proved in the third chapter Financial Analysis, that the sample companies boosted their financial health during the Post Revamped Regime. Thus in short all the sample companies have presented comparatively better financial performance during the post revamped period i.e. after the revitalization in MoUs with government. Even though the performance was good, it lacks the level where it was to be due to price control implemented by the government. This led the sample companies to subsidy trouble and under recovery problems (in case of Petroleum Industries). The non parametric test conducted in the third topic reveals that the sample companies performed differently during the two study periods. (Refer Table: 5.2) Regarding qualitative aspects the first part of test results proves that during the study period the sample companies had an assured return on investment, market share were protected, reduced risk of cost by reimbursement strategy and well knowledge of local market with considerably good network. But they had to fight against highly competitive environment with its diminishing production rates & innovation. In these circumstances these sample companies had plenty of opportunities due to the kind of economic growth prevailed in the country. During this era these sample companies tried to modernize the system by using updated technology and internet but they failed to balance with international markets. Apart from this the sample companies had to face high interference of government in financial policies and strict regulation towards foreign direct investment during this era. But in case of post revamped region the things were changed. 164

19 The sample companies modernised their internal system by using internet and technology. By the implementation of Abolishing Market Share Protection Scheme (in case of Petroleum Industries), the sample companies changed their attitude from risk averter to risk taker. Post revamped regime was an era of latest automation for diminishing costs & investment in credit worthy projects for sample companies. In short during the post revamped period the sample companies were strong enough with plenty of opportunities to face the competition from indigenous or global practitioners. As compared to pre revamped regime threat and weakness of the organisation were considerable to chase its mission and thereby to sustain the growth rate. The second part of the qualitative aspects test results (concerned with competitiveness & efficiency test) shows that the Efficiency test of Hindustan Petroleum Corporation Limited and Shipping Corporation of India Limited recorded higher improvement during post revamped period. If HPCL and SCIL recorded 8.87% and 16.45% efficiency growth rate respectively during post revamped regime, it was 6.13% and 14.41% during the pre revamped period. Only in case of BPCL there was moderate decline in the efficiency growth rate. In this case it was reduced by 2.96%. The comparative competency test performed during the two study periods also shows that all the sample companies recorded higher competitiveness during the post revamped regime. In the post revamped period BPCL, HPCL and SCIL recorded 7.78%, 6.63 %, and % competency growth rate as against 7.71%, 5.14% and 9.75% respectively, during the pre revamped period. Thus in short the efficiency and competitiveness test performed on the basis of templates developed in the third chapter also support that the efficiency and competitiveness of the sample companies were improved during post revamped regime than pre revamped regime. This strengthens our fourth hypothesis i.e. The revitalization in MoUs with government enhanced competency of Public Sector Enterprises. (Refer Table: 5.2) 165

20 To the best of my knowledge, there is no comprehensive study which will assess the impact of MoU with Balance Score Card System on the performance of Public Sector Enterprises and thereby the social enhancement has been taken place especially in the Maharashtra State. Perhaps this will be the one and only study covering the time span of ten to twelve years by using all financial parameters such as profitability, efficiency, liquidity, and productivity in assessing their performance. Since the study covers all the quantitative and qualitative aspects, the study will be beneficial to government regulatory bodies, policy formulators, investors and Public Sector Enterprises. 166