Starting a business in India is a significant endeavor, and selecting the appropriate legal structure is crucial. For entrepreneurs aiming for substantial growth and public investment, forming a Public Limited Company (PLC) is a strategic choice.
A PLC offers advantages such as limited liability protection, the ability to raise capital through public offerings, and enhanced market credibility.
At Accountrepreneur, we leverage over 10 years of experience to guide entrepreneurs through the PLC registration process. Our approach is cost-effective, transparent, and tailored to ensure compliance with all legal requirements. We manage the complexities of incorporation, allowing you to focus on expanding your business and achieving your objectives.
A Public Limited Company (PLC) is a corporate entity in India that offers its shares to the general public and has limited liability. This structure allows companies to raise capital by issuing shares through public offerings or trading on stock exchanges. PLCs are governed by the Companies Act, 2013, which mandates strict regulatory and reporting standards to ensure transparency and protect investors.
PLCs can raise funds by issuing shares to the public through stock exchanges, facilitating significant capital accumulation for expansion and operations.
Listing on stock exchanges enhances a company’s public profile, fostering trust among investors, customers, and financial institutions, which can lead to better business opportunities.
PLCs must adhere to stringent regulatory and disclosure requirements, ensuring transparency and protecting investor interests.
While PLC registration is the most popular, India offers various types of company registrations:
| Key Feature | Private Limited Company | Public Limited Company | LLP (Limited Liability Partnership) | Sole Proprietorship | Partnership Firm |
|---|---|---|---|---|---|
| Applicable Law | Companies Act, 2013 | Companies Act, 2013 | LLP Act, 2008 | No specified Act | Partnership Act, 1932 |
| Ownership Structure | 2–200 shareholders | Unlimited public shareholders | 2 or more partners | Single owner | 2–50 partners |
| Liability Protection | Limited to shares | Limited to shares | Limited to partners' contribution | Unlimited liability | Unlimited liability |
| Legal Entity Status | Separate legal entity | Separate legal entity | Separate legal entity | Not a separate entity | Not a separate entity |
| Registration | Mandatory | Mandatory | Mandatory | Not required | Optional |
| Minimum Capital | No minimum capital | High capital requirement | No minimum capital | Owner’s resources | No minimum capital |
| Taxation | Corporate tax rates (22%-30%) | Corporate tax rates | Flat 30% tax rate | Taxed as individual income | Taxed as individual income |
| Compliance | High compliance; annual filings | Very high compliance; public filing | Moderate compliance | Minimal compliance | Minimal compliance |
| Governance | Directors appointed by shareholders | Managed by board of directors | Managed by designated partners | Fully controlled by owner | Jointly managed by partners |
| Ownership Transfer | Restricted with approval | Freely transferable | Restricted by partner agreement | Not transferable | Requires mutual consent |
| Business Continuity | Perpetual | Perpetual | Limited unless reconstituted | Ends with owner's exit | Ends unless reformed |
| FDI (Foreign Investment) | Allowed in most sectors | Allowed with restrictions | Allowed with approval | Not allowed | Not allowed |
| Best For | Startups, scalable businesses | Large-scale businesses | Small businesses, startups | Freelancers, small traders | Small family businesses |
| Examples | Swiggy, Zomato | Infosys, TCS | Small consulting firms | Local kirana shops | Family-run retail stores |
For businesses aiming for substantial growth and public investment, registering as a Public Limited Company (PLC) in India offers an optimal balance of protection and expansion potential. Interested in the registration process? We’re here to guide you to the best option for your business.
Frequently asked questions to address your queries about public limited registration with Accountrepreneur
A Public Limited Company is a business entity registered under the Companies Act, 2013, that can offer its shares to the general public. It has limited liability for its members, a separate legal identity, and must have “Limited” as the last word in its name.
To form a PLC, you need a minimum of 3 directors (with at least 1 resident of India) and a minimum of 7 shareholders. There is no maximum limit on shareholders.
A PLC can have unlimited shareholders. This makes it the ideal structure for large-scale businesses aiming to raise substantial funds.
Incorporation is done through MCA filings using SPICe+ forms, with documents like MoA, AoA, PAN, address proof, and DSCs. After incorporation, a Certificate of Commencement of Business (Form INC-20A) must be filed before operations can begin.
Access to large capital, limited liability, free transferability of shares, perpetual succession, and enhanced credibility with investors and regulators.
There is no statutory minimum paid-up capital under the Companies Act, 2013. However, adequate subscribed capital is required to meet your business objectives and regulatory requirements.
Any group of 7 or more individuals or entities can form a PLC, provided at least one director is an Indian resident.
Benefits: Easy access to capital, credibility, investor trust, scope for expansion.
Drawbacks: Higher compliance costs, stricter regulatory norms, and more disclosure requirements.
Our experts will handle everything from MCA filings to compliance so you can focus on scaling your business and attracting investors.