According to Hanson, government companies are of the following categories :
1. First, sometimes a government may acquire shares in a big private concern so as to save it from bankruptcy, with the eventual object of resale.
2. Secondly, the government may start a new enterprise In collaboration with a private firm, which is prepared to provide capital or technical skill, etc.
3. Thirdly, the government may start an enterprise with the intention to sell it to private investors, wholly or partly, when it starts earning profit at an attractive rate.
4. Fourthly, sometimes the government may establish a public enterprise which would be under its permanent control.
Dr. R.K. Jain has classified the government companies in India into the following four categories :
(a) There are certain companies, whose main object is to promote industrial development. However, they themselves do not carry on any production. The National Industrial Development Corporation or the National Small Industries Corporation, etc., belong to this category.
(b) There are certain projects at the construction stage.
(c) The third category is composed of projects which take part in production directly, such as, the Hindustan Machine Tools, the Hindustan Antibiotics, etc.
(d) The last category consists of those companies whose primary objective is the promotion of trade. The State Trading Corporation is a leading example of this category.