The Company defined under clause 71 of the Companies Act, 2013, a public company which:-
1. is not a private company.
2. has a minimum paid-up capital of Rs. 5 Lakhs or such higher capital as may be prescribed.
3. is a private company but subsidiary of a public company.
There are a few sizeable advantages to having a public limited company. Limited Liability for shareholders. The business is viewed as a separate legal entity. This means that even if a shareholder(s) leaves the PLC or dies, the business can continue. Ability to raise a large amount of capital. Public limited companies are able to raise large sums of money because there is no limit to how many shareholders a PLC can have. The shares of the PLCs are freely transferable. This provides liquidity for shareholders.
COMPANY:-Although there are profitable advantages to forming a public limited company there are some distinct disadvantages. There are many legal formalities for starting a public limited company. There must be at least 7shareholders before the PLC can be formed. Accounts for PLCs must be filed within 6 months of the year’s end. There must be at least 3 directors. The company’s secretary must be certified. In order to protect public investors, there are many controls and regulations that the business must follow. There is a possibility that the original owners can lose control of the public limited company in the issue of a dispute or violation. Some public limited companies can grow very large. As a result, many can suffer from mismanagement and slow decision making.