Public Limited Company
A Public Limited Company (PLC) is designed for large-scale enterprises that intend to raise capital from the general public by offering shares on a stock exchange. While it has more stringent compliance requirements, it offers unparalleled advantages in capital accessibility and brand credibility.
Features of a Public Limited Company:
- Directors and Members: A minimum of three directors and seven members are required, with no upper limit on members.
- Limited Liability: Shareholders' liability is limited to the amount unpaid on their shares.
- Paid-up Capital: A minimum paid-up share capital of ₹5 lakhs is required.
- Prospectus: A PLC must issue a prospectus when making a public offer of its shares.
- Name: The name must end with the word "Limited".
Advantages of a Public Limited Company:
- Better access to capital through public offerings.
- Easy transferability of shares on the stock exchange.
- Significant growth and expansion opportunities.
- Enhanced credibility and brand visibility.
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Do You Have Any Questions?
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What are the minimum requirements for a Public Limited Company?
You need a minimum of three directors and seven shareholders (or members). There is no maximum limit on shareholders.
Who should form a Public Limited Company?
This structure is suitable for large-scale businesses that plan to raise significant capital from the general public through an Initial Public Offering (IPO).
What are the disadvantages?
The compliance requirements (statutory meetings, more filings) are much higher and more complex than for a Private Limited Company, leading to higher operational costs.
Can a Public Limited Company be unlisted?
Yes. A company can be a “Public Limited Company” without being “Listed” on a stock exchange. However, it must still follow the stricter compliance rules.