Public Limited Company

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Overview Advantages Registration Process Required documents FAQ's

Public Limited Company

A public Limited company is a company that has limited liability & unlike the private limited company, the shares are offered to the general public. It is registered under the Companies Act, 2013. For incorporation, a minimum of 7 shareholders & 3 directors is required. The directors can also be shareholders.

It has all the advantages of a private limited company. The shareholders in a public limited company can transfer their shares with great ease. The liabilities of the members are limited. It is compulsory to add ‘limited’ after their name.

Why Public Limited Company?

SEPARATE LEGAL ENTITY A Public limited company is considered as a separate legal entity for the law. Accordingly, it can hold property in its name, sue & be sued, borrow in its name, etc.
LIMITED LIABILITY The members are considered separate from the company. So, they are not liable for the creditors of the company.
IMPROVES CAPITAL Since, the shares can be issued to the general public, anyone can invest in a public limited company & the capital of the company gets improved.
PREFERENCE BY INVESTORS It is preferred by investors as it is a well structured & transparent business structure.
SPREAD OUT RISK Since the shares are issued to the public, the risk in the market is spread out.
TRANSFER OF SHARES In a public limited company, it is very easy to exit by just handing over the shares along with the duly signed share transfer forms.
LARGE INVESTMENT It is a preferable business structure for a large amount of investment.
EXPANSION Due to less risk, there is a perfect opportunity for growing & expanding the business by investing in new projects, the money raised through shares.

Public Limited Company Registration Process

Documents required

1. Copy of PAN Card of directors

2. Passport size photograph of directors

3. Copy of Aadhaar Card/ Voter identity card

4. Copy of Rent agreement (If rented property)

5. Electricity/ Water bill (Business Place)

6. Copy of Property papers (If owned property)

7. Landlord NOC (Format will be provided)

Frequently Asked Questions

Once the company is formed, it will be valid until it is officially closed down by the owners. No renewal is required. However, every year companies have to file very basic returns with ROC office.

There is no maximum limit for the number of shareholders in a public limited company.

Yes, the office address can be changed anytime after incorporation.

Since public money is involved it has to undertake strict compliances. Apart from the regular compliances related to income tax, there are many periodic and annual compliances to be made by a public limited company with ROC/MCA, SEBI, RBI, etc. These regulatory liabilities are in addition to securing and promoting steadily the profits and welfare of all shareholders of the public limited company.

Yes, an NRI or Foreign National can also be a shareholder or director in a public limited company of India.

Yes, a salaried person can become a director of the company.

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