Public Limited Company

A public limited company (PLC) is a type of company that is allowed to offer its shares for sale to the public. PLCs are regulated by the Companies Act, 2013, and must meet certain requirements, such as having a minimum authorized share capital of ₹1 lakh.

Here are some of the key features of a PLC:

• Limited liability: The liability of the shareholders of a PLC is limited to the amount of capital that they have contributed to the company. This means that if the company cannot pay its debts, the creditors cannot sue the shareholders for the full amount of the debt.
• Separate legal entity: A PLC is a separate legal entity from its shareholders, which means that the shareholders’ personal assets are protected from the liabilities of the company.
• Public offering: PLCs are allowed to offer their shares for sale to the public, which means that anyone can buy shares in the company.
• Securities Exchange Listing: PLCs can be listed on a stock exchange, which means that their shares can be traded on the stock market.
• Corporate governance: PLCs are subject to a number of corporate governance requirements, such as having a board of directors and a separate auditor.

PLCs can be a good option for businesses that want to raise capital from the public and that want to be listed on a stock exchange. However, there are also some disadvantages to PLCs, such as:

• Cost: The formation and registration of a PLC can be more expensive than other types of companies.
• Regulation: PLCs are subject to more regulation than other types of companies.
• Transparency: PLCs are required to disclose more information to the public than other types of companies.

Here are some of the benefits of forming a public limited company:

• Access to capital: PLCs can raise capital from the public by issuing shares. This can be a good way to finance the growth of the business.
• Increased liquidity: The shares of PLCs can be traded on the stock market, which gives shareholders the ability to sell their shares easily.
• Enhanced brand image: PLCs are seen as being more credible and stable than other types of companies. This can help to attract customers and investors.
• Increased opportunities for growth: PLCs can grow more quickly than other types of companies because they have access to more capital.

Here are some of the challenges of forming a public limited company:

• Cost: The formation and registration of a PLC can be more expensive than other types of companies.
• Regulation: PLCs are subject to more regulation than other types of companies. This can be time-consuming and complex.
• Transparency: PLCs are required to disclose more information to the public than other types of companies. This can make it more difficult to keep sensitive information confidential.

If you are considering forming a public limited company, you should carefully consider the benefits and challenges before making a decision.

The minimum requirements for forming a public limited company (PLC) in India:

• Minimum number of shareholders: 7
• Minimum number of directors: 3
• Minimum authorized share capital: ₹1 lakh
• Memorandum of Association (MoA): The MoA is a document that sets out the basic structure and rules of the company. It must be filed with the Registrar of Companies (RoC).
• Articles of Association (AOA): The AOA is a document that sets out the detailed rules and regulations of the company. It must also be filed with the RoC.
• Digital Signature Certificate (DSC): A DSC is a digital certificate that is used to sign electronic documents. It is required for filing documents with the RoC.
• Director Identification Number (DIN): A DIN is a unique identification number that is issued to directors of companies. It is required for all directors of a PLC.
• Registered office: The company must have a registered office in India.

In addition to these minimum requirements, there are a number of other requirements that must be met in order to form a PLC. These requirements are set out in the Companies Act, 2013.