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Convert Private Company to Public company
Expand Business Opportunities with a Public Company
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Conversion of a Private Limited Company to Public Limited Company
Transforming a Private Company into a Public Company unlocks new opportunities, particularly for fundraising and expanding market presence. As a Public Company, it can raise capital through Public Issues and accept deposits, making this structure suitable for medium to large enterprises. The conversion process involves obtaining government approval and making amendments to the Memorandum of Association (MoA) and Articles of Association (AoA).
Moreover, the conversion requires at least 7 members and 3 directors. While the company's rights, liabilities, powers, and obligations remain unchanged, a public company benefits from unrestricted share transfers, unlike its private counterpart.
Advantages of Converting Private Limited Company to Public Limited Company
Raising capital through public issue of shares
One of the key advantages of a public limited company is its capacity to issue shares. Particularly when listed on a recognized stock exchange, it can draw in investments from hedge funds, mutual funds, and other sources. This allows for raising significantly larger amounts of capital compared to a private limited company.
Limited Liability
Each shareholder's or member's liability is limited, and this protection persists through the conversion. Their exposure is restricted to their shareholding, safeguarding their personal assets from any risks associated with the company.
Enhanced Brand Awareness
When a company goes public and gets listed on a stock exchange, it enhances its visibility, leading to greater awareness of its operations. This increased brand recognition can attract more business opportunities.
Transferability of shares
Shares in a public limited company are more easily transferable compared to those in a private limited company. This enables shareholders to sell their shares, providing them with liquidity. This feature encourages investment, as it assures investors that they are not obligated to remain with the company indefinitely.
Complete Registration Form
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Our expert team will manage the Conversion of Private Company to Public company
Certificate of incorporation will be mailed after completion of registration
How to Convert Private Company to Public company with Corporate Shastra
Documents Required for Conversion of Private Company to Public Company
PAN Card: PAN cards of all shareholders and directors. Foreign nationals can provide their passport instead.
Identity Proof: Voter ID, passport, or driving license of shareholders and directors.
Address Proof: Recent telephone bill, electricity bill, or latest bank account statement of shareholders and directors.
Photograph: A recent passport-sized photograph of each shareholder and director.
Business Address Proof: The latest electricity bill or telephone bill for the registered office address.
NOC from owner: A No Objection Certificate from the owner(s) of the registered office is required.
Rent Agreement: If applicable, the rent agreement for the registered office must be provided.
Incorporation documents: Include the Certificate of Incorporation, Memorandum of Association (MoA), and Articles of Association (AoA).
Financial Statements: A duly certified copy of the latest audited financial statements.
Income Tax Return: The income tax return filed for the previous financial year should be submitted.
Note: In case of NRI or Foreign National, documents of director(s) must be notarized or apostilled
Explore Conversion from Private to Public Company
What is the primary requirement for setting up a Public Limited Company in India?
The primary requirement to incorporate a public limited company is that it requires minimum 7 shareholders and 3 directors. The minimum Authorised Capital of the company is prescribed to ₹ 5 Lakhs instead of ₹ 1 Lakh in case of Private Company.
Whether change of name is required for conversion?
What are the liabilities of a Public Limited Company?
Comparison of Business Structures
Proprietorship | Partnership | OPC | LLP | Private Limited | |
|---|---|---|---|---|---|
Ownership | Sole Ownership | Min 2 partners Max 50 partners | Only 1 member | Min 2 Designated Partners | Min 2 Directors Min 2 Shareholders Max 15 Directors Max 200 Shareholders |
Separate
Legal Entity | No | No | Yes | Yes | Yes |
Applicable Law | No specified Act | Partnership Act, 1932 | Companies Act, 2013 | Limited Liability Partnership Act, 2008 | Companies Act, 2013 |
Statutory Audit | Not Mandatory | Not Mandatory | Mandatory | Based On Applicability | Mandatory |
Liability | Unlimited | Unlimited | Limited | Limited | Limited |
Perpetual Existence | No | No | Yes | Yes | Yes |
Ownership Transferability | No | Yes (Restricted) | Yes (Restricted) | Yes | Yes |
Taxability | Low | High | Moderate | High | Moderate |
Compliance
Requirement | Low | Low | High | Moderate | High |