Public Limited Company
According to the Companies Act, 2013 Public Limited Company (PLC) is a type of company that is owned by shareholders and can offer its shares to the general public on the stock exchanges. The minimum number of shareholders required to form a public limited company is seven, and there is no limit on the maximum number of shareholders. The liability of the shareholders in a public limited company is limited to the amount of shares they hold in the company.
Advantages to Incorporate a Public Limited Company
- Raising capital: A public limited company can raise capital by issuing shares to the public and listing them on a recognized exchange. This allows the company to attract investment from a wide range of investors, including hedge funds, mutual funds, and other institutional traders.
- Spreading risk: Offering shares to the public allows the opportunity to spread the risk of company ownership among a large number of shareholders. This may allow early investors in the company to sell some of their own shares at a profit while still retaining a substantial stake in the company.
- Greater access to finance: A public limited company will often find itself in a better position when looking at other potential sources of finance, such as bank loans or bonds.
- Increased brand awareness: Being listed on a stock exchange can improve a company’s prestige and reputation, which can lead to increased brand awareness.
- Limited liability: The liability of each shareholder is limited, meaning that shareholders are not personally responsible for any loss or debts of the company for any amount greater than the amount invested by them.
- Growth and expansion opportunities: Due to less risk, there is an opportunity for growing and expanding the business by investing in new projects from the money raised through shares.
Required Documents for Public Limited Company
- Here is what you should keep in mind when registering a public limited company:
- Minimum 7 shareholders are required to form a public limited company.
- Minimum of 3 directors is required to form a public limited company.
- A minimum authorised share capital of Rs. 1 lakh is required.
- Digital signature certificate (DSC) of one of the directors is needed while submitting self-attested copies of identity and address proof.
- Directors of the proposed company will need a DIN.
- The name of the company must be as per the provision of the Company Act and Rules.
- Documents like the Memorandum of Association (MOA), Articles of Association (AOA) and duly filled Form DIR – 12 is needed.
- Payment of the prescribed registration fees to the ROC is required.
- Documents Required for Incorporating a Public Limited Company
- Proof of identity of all the shareholders and directors.
- Proof of address of all the directors and the shareholders.
- PAN number of all the shareholders and directors.
- Utility bill of the proposed office i.e. proposed registered office for the company.
- A NOC (No Objection Certificate) from the landlord where the office of the company will be situated.
- Director Identification Number (DIN) of all the directors.
- Digital Signature Certificate (DSC) of the directors.
- Memorandum of Association (MOA)
- Articles of association (AOA)
