Private Limited Company to Public Limited Company
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Why to Convert from Private Limited Company to Public Limited Company?
Converting a Private Limited Company to a Public Limited Company uplifts the business. It widens the opportunity, especially by leading access to the market at a broader range and also at raising funds. In a public limited company, even a common man can become a member of the entity. Furthermore, the company can raise funds by making public issues of shares and can also accept deposits from the general public which private limited companies are prohibited as per Companies Act.
For conversion of Private Limited Company to Public Limited Company, the following significant changes will be required:
- The requirement for minimum no. of directors will be raised to 3
- The requirement for minimum no. of shareholders will be raised to 7
- The suffix "Pvt Ltd" in the name of the Company will change to “Ltd”
- The MOA and AOA of the company will be altered with the approval of the Government for removing the restriction on transferability of shares and maximum limit of shareholder
- Minimum authorized share capital requirement will be raised to Rs. 5,00,000/- from Rs. 1,00,000/-
Table Of Contents
Benefits of Conversion into a Public Limited Company from Private Limited Company
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Raising funds from multiple avenues
Public companies can easily raise funds from financial institutions as well as Individuals through equity shareholding, preference shareholding, debentures stock, etc. Also, Public Companies can issue securities to the general public through Initial Public Offer (IPO) or Further Public Offer (FPO) without any restrictions -
Easy Transferability of Shares
Unlike Private Limited Company, there is no such restriction on the transferability of share under Public Limited Company. The shareholders can freely purchase and sell the shares in any quantity without obtaining any prior permission. This feature takes off the worries of shareholders by not binding them to remain in the company forever -
No Maximum Limit for Shareholders
There is no maximum limit for admission of shareholders in the Company; these prove an essential way for the Company to raise funds moreover even the public can purchase shares in these companies and participate in the profits -
Brand Awareness
After getting status of Public Limited Company, a company may also get listed in one or more stock exchanges thereby the visibility of the company increases, and more people become aware of the Company, its productions, supplies, etc. However, the public listing feature is not available in a Private Limited Company
Documents Requirement for Conversion
For every Director and Shareholder:
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Identity Proof
a) PAN (Indian Nationals) or Passport (if NRI) And
b) Passport /Aadhar ID/ Driver's License / Election ID / Ration Card -
Proof of Residence
a) Bank Statement / Electricity Bill / Mobile Bill
- Latest Passport size photograph
For Registered office:
- Telephone bill/gas bill/electricity bill (not older than two months)
- Copy of rent/lease agreement in the name of the Company OR Registered document of title of the premises
- NOC obtained from the Landlord to use the premises by the Company as its registered office
For Company:
- Certificate of Incorporation, MOA and AOA
- Duly certified copy of the latest audited financial statement
- Copy of Income-tax return filed for the previous year
How can we help you?
We have a team of experts to view your request and to carry out the procedure efficiently.
- Submit a service request by clicking here
- Our expert team will contact you with a simple checklist
- Fill in the checklist and submit the required documents
- Our team will verify the documents sent by you
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After examining the documents by our team member, the conversion procedure will get initiated
- DSC procurement
- Alteration of MOA and AOA
- Application to modify PAN and TAN
- Drafting for necessary resolution for Public Company incorporation
- Drafting of other documents and Affidavit
- Submission for necessary online form for conversion
- Application for modification in GST registration
- Post conversion, you will be required to update your Bank Account details
- Throughout the process, our dedicated manager will keep you updated on the progress of the application.
FAQs
a.Whether the Company is required to change the name after the conversion procedure?
No, The Company can continue the business in its existing name; however, only the suffix "Pvt Ltd" will be changed to Ltd".
b. Is it mandatory for a public company to get listed?
A public company may not always be listed. A public company can be unlisted but can have an unlimited number of shareholders to raise capital for any commercial venture.
c. Can Foreign national/NRIs be a Director in a Private Limited Company?
Yes, a foreign nationals or NRIs can be directors in a Limited Company after obtaining a Director Identification Number (DIN). However, the Company must at least have one Indian-Resident as a Director on the Board of Directors.
d. Still have doubts?
Speak to our experts who shall solve all your doubts.
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