Public Limited Company

Public Limited Company is a type of public company (publicly held company). It is a limited (liability) company whose shares may be freely sold and traded to public  (although PLC may also be privately held, often by another PLC), with a certain minimum share capital and the letters PLC after its name.

Minimum paid up capital of Rs. 5 lakhs or such higher capital as may be prescribed and Minimum number of members is 7 and maximum number of members is unlimited.

Advantages of a Public Limited Company includes:

  • Raising capital through public issue of shares
  • Widening the shareholder base and spreading risk
  • Other finance opportunities
  • Growth and expansion opportunities
  • Prestigious profile and confidence
  • Transfer-ability of shares
  • Exit Strategy

Disadvantages of a Public Limited Company:

  • More regulatory requirements
  • Higher levels of transparency required
  • Ownership and control issues
  • More vulnerable to takeovers
  • Short-termism
  • Initial financial commitment is higher

Process to create a Public Limited Company:

  • Name Approval with Registrar of Companies (maximum 3 Names can be submitted)
  • Preparation of Documents for Incorporation of Company
  • Submit the documents to ROC
  • ROC will give DIN, PAN, TAN, along with Certificate of Incorporation
  • Commence your Business.

Documents required:

  • Apply for Digital Signature Certificate
  • Declaration by first subscriber(s) and first director(s).
  • Memorandum of Association
  • Articles of Association
  • Declaration by advocate/ CA/ Cost Accountant/ CS in practice in Form INC-8.
  • NOC from the owner of the property.
  • Proof of Office address (Conveyance/ Lease deed/ Rent Agreement etc. along with rent receipts);
  • Copy of the utility bills (not older than two months)
  • In principle approval from the concerned regulator, if any.
  • In principle approval from the concerned regulator, if any, it is mandatory to attach proof of identity and residential address of the subscribers.

Check List of a Public Limited Company:

  • Opening a Bank Account
  • Deposit of Capital & Issue of Shares
  • Commencement of Business
  • Intimation of Registered Office Address
  • Appointing a Statutory Auditor
  • Other Registrations and Compliance
  • Intellectual Property Registration
  • Drafting documents
  • Exhibition of Company Name
  • Disclosure of Directors’ interest
  • Maintaining Statutory Registers & records
  • Accounts and Bookkeeping
  • Other noteworthy provisions