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A Public Limited Company is an ideal business structure for large enterprises that require significant capital. This type of company offers several advantages, including limited liability and the ability to raise capital by selling shares to the general public. Public Limited Companies are registered under the Companies Act, 2013. They have the option to list their shares on the stock market and issue Initial Public Offerings (IPOs) to attract investments. In this guide, you'll learn about the benefits, registration process, and requirements for establishing a Public Limited Company in India.
A Public Limited Company is a business entity with limited liability and the capability to offer shares to the general public for raising equity capital. This company structure is governed by the Companies Act, 2013 and is registered under the Ministry of Corporate Affairs. It must be incorporated with a minimum of seven members, and at least three of these members must also serve as directors of the company.
One of the most compelling advantages of forming a Public Limited Company is the principle of limited liability, which serves as a critical safeguard for the personal assets of the company's shareholders. Limited liability provides a strong legal shield that separates the financial obligations of the company from the individual assets of its owners. Here's why this protection is so significant
A public limited company is recognized as a separate legal entity with its own distinct identity. This means that the business owners, who are the shareholders, are not personally liable for the company's debts and liabilities. The company itself can acquire assets, enter into contracts, and incur debts in its own name, separate from the personal assets and liabilities of its shareholders. This limited liability protection is a key advantage of structuring a business as a public limited company, as it safeguards the personal assets of the owners from being seized to settle the company's financial obligations.
Public Limited Company can raise funds by offering shares to the general public and hence it can raise more capital easily. The ability to issue shares to the public allows for a wide pool of potential investors, making it easier to accumulate capital for business expansion and development. This can be done through Initial Public Offerings (IPOs) where shares of the company are offered to the public for subscription. This is a significant advantage when it comes to funding large-scale projects and business operations.
Public Limited Companies can raise capital by offering shares to the general public. It allows them to raise substantial funds, making it ideal for large-scale business operations and expansion. Public Limited Companies can access the capital market for their financial needs and growth plans.
Unlike Private Limited Company where the shares can only be transferred with the consent of other members of the company, a public limited company can easily transfer the shares freely.
Minimum of seven members are required
Minimum of 5 lakh rupees is required for share capital
At least three members must be the directors of the company
For the registration of a Public Limited Company in India, obtaining a Digital Signature Certificate (DSC) is a mandatory requirement. Directors and subscribers to the memorandum of the company must apply for DSCs from certified agencies. Obtaining a DSC is a straightforward online process that typically takes around 24 hours to complete. Here's an overview of the DSC application process.
Name application for Public Limited Company can be done through SPICe RUN form which is a part of SPICe+ form. While making the name application of the company, industrial activity code as well as object clause of the company has to be defined.
Note:It should be ensured that business name does not resemble the name of any other already registered company and also does not violate the provisions of emblems and names (Prevention of Improper Use Act, 1950). You can easily check the name availability by using our company name search tool to verify the same.
Post name approval, details with respect to registration of the company has to be drafted in the SPICe+ form. It is a simplified proforma for incorporating a company electronically. The details in the form are as follows:
SPICe e-MoA and e-AoA are the linked forms which have to be drafted at the time of application for company registration.
Memorandum of Association (MOA) is defined under section 2(56) of the Companies Act 2013. It is the foundation on which the company is built. It defines the constitution, powers and objects of the company.
The Articles of Association (AOA) is defined under section 2(5) of the Companies Act. It details all the rules and regulations relating to the management of the company.
Post approval of the above mentioned documents from the Ministry of Corporate Affairs; PAN, TAN & Certificate of Incorporation will be issued from the concerned department. Now, the company is required to open a current bank account by using these documents. You can contact us for assistance with your current bank account opening.
As per the Companies Act 2013, you need to provide proper identity proof of members and directors along with valid address proof of the business office. It is important to note that you don't need to own a commercial property for company registration; one can use his residential address for incorporation of the company. Here are the documents required.
The process of registering your company as a Private Limited Company can be complex and involves various compliance requirements. Our experts at Docs Uncle can streamline the entire registration process for you. Register your company online in 3 simple steps:
Step 1:
Get in touch via call or contact form
Step 2:
Provide necessary documents
Step 3:
Get your incorpation registered in 14-21 days
The total fee for OPC firm registration in Rs. ₹7,499 Only which includes the Government fee as well professional fee of Docs Uncle.
On average, it takes around 7-10 working days for registration of Partnership firm in India subject to document verification by the concerned authorities.
You can register your public limited company with a minimum of 7 members and three of them must be the directors of the company. You’re required to arrange proper identity and address proof of directors, members and business office along with declaration of a professional like CA, CS, etc.
The formation of a public limited company typically requires a minimum of seven members.
Yes, a public limited company can be listed on stock exchange. This type of business entity is meant to offer shares to the general public for raising capital by various methods like Initial Public Offerings (IPO).
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