Public Limited Company
Public Limited Company Rs. 13,999/- + Govt. Fees No Hidden Charges Duration-8 to 10 days
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.
ADVANTAGES OF A PUBLIC LIMITED 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.
DISADVANTAGES A PUBLIC LIMITED COMPANY
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.
Frequently Asked Question
The Public Limited Company is a wider form of the limited company, which has no restriction on the maximum number of shareholders, listing its shares in the stock market, transfer of shares, and raising funds from public and accepting public deposits; all of these activities cannot be done by a private limited company. Again, unlike a private limited company, a public limited company is governed and managed by a Board of Directors constituted as per the unanimous consent of the shareholders. However, a public limited company has much more compliance burden, as compared to that necessary for a private limited company.
In addition to enjoying all those features and facilities which a private limited company relishes, a public limited company is entitled to go public, issue its shares in the stock market, or accept public deposits. The following are the main and most significant exclusive features of a public limited company:
- A public limited company can have a rather huge magnitude of capital, much more than that gathered by a private limited company.
- It is legally authorized to trade on stock exchanges.
- There is no limit to the maximum number of shareholders in a public limited company.
- The shareholders of a public limited company have limited liabilities, limited roughly to the face value of the shares they own. Again, shareholders do not have to take part in the day-to-day management of the business of the company.
- Shareholders of a public limited company are entitled to transfer their shares freely without needing the consent of someone.
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