Know about Conversion of a Private Limited Company into Public Limited Company

When a Private Company is converted into a Public Company, it opens up new opportunities, especially in terms of fundraising and market reach. The company can raise funds through a public issue and accept deposits, making this structure suitable for medium and large-scale businesses. The conversion process requires approval from the government and changes to the company's Memorandum and Articles of Association. In addition, a minimum of 7 members and 3 directors are required for the conversion from Private to Public Limited. The company's rights, liabilities, powers, and obligations remain unchanged even after the conversion. The transfer of shares becomes possible as the restriction on transfer is removed during the conversion process.

Benefits of Conversion of Private Limited into Public Limited

Raising capital through public issue of shares

One of the significant advantages of a public limited company is its capacity to generate funds by issuing shares. This becomes even more beneficial if the company is listed on a recognized stock exchange, as it can attract investors like hedge funds and mutual funds. In comparison to a private limited company, a public limited company has the potential to raise a significantly larger amount of capital.

Brand Awareness

When a company becomes publicly listed on the stock exchange, it gains exposure to a wider audience and increased brand recognition, which can lead to more business opportunities.

Limited liability

The limitation of liability for each shareholder or member remains unchanged after the conversion. Their liability is restricted to the amount of their shareholding, and their personal assets are not jeopardized.

Transferability of shares

Documents Required for Conversion of Private Company to Public Company

PAN Card

PAN Card of shareholders and Directors. Foreign nationals must provide a valid a passport.

Identity Proof

Voter ID/ Passport/ Driving License of Shareholders and Directors

Address Proof

Telephone Bill /Electricity Bill/ Latest Bank Account Statement of Shareholders and Directors

Photograph

Latest Passport size photograph of Shareholders and Directors

Business Address Proof

Electricity Bill/ Telephone Bill of the registered office address

NOC from owner

No Objection Certificate to be obtained from the owner(s) of registered office

Rent Agreement

Rent Agreement of the registered office should be provided, if any

Note

In case of NRI or Foreign National, documents of director(s) must be notarized or apostilled

Incorporation documents

Certificate of Incorporation, MoA & AoA to be provided

Financial Statements

Duly certified copy of latest audited Financial Statements

Income Tax Return

ITR filed for the previous financial year to be submitted

Convert Private limited to Public Company in 3 Easy Steps

1. Answer Quick Questions

Fill in our questionnaires that take less than 10 minutes
Provide basic details & documents required for registration
Make payment through secured payment gateways

2. Experts are Here to Help

Assigning a dedicated Relationship Manager
Procurement of Digital Signatures (DSC)
Alteration of MoA & AoA
Documents drafting including incorporation documents
Certificate of Incorporation
Application for change in PAN & TAN

3. Your private company is converted to Public limited

All it takes is 20 – 25 working days*

_{*Subject to Government processing time}

Process of conversion into Public Company

Day 1-2

Consultancy and assistance for conversion
Collection of basic information & documents
Application of DSC of new director

Day 3– 7

Drafting of necessary resolutions
Drafting of other required documents & affidavit
Alteration of MoA & AoA
Provide documents required drafted after signature

Day 8 – 15

Online filing of form for alteration of MoA & AoA
Government processing time to approve the application

Day 16 – 20 onwards

Online filing of form applicable for conversion
Government processing time to approve the application*

Explore Private to Public company conversion

Frequently Asked Questions

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.

The suffix “Private Limited” will be replaced with “Limited.” For this change, the company has to seek permission from the shareholders and after that make the required changes in the MoA to get it amended.

Since the Public limited company deals with the public’s money, it requires taking measures which increase the statutory compliance on its part. The regulatory liabilities are not restricted to the income tax but with ROC/MCA, SEBI, RBI, etc. It is important to take extra measures as the stakes are pretty high than any other company.

Once the name approval letter is received from the ROC, the MoA and AoA are required to be drafted. The name clause and capital clause are altered along with the removal of restriction to Private Company as provided by definition.

The company can start its business operations as a Public Company on receipt of the fresh Certificate of Incorporation from RoC.

nxtwaystartup.com can help you convert your Private limited into a Public Limited Company within 20-25 working days. The time taken for conversion will depend on the submission of relevant documents by the client and speed of Government Approvals. To ensure speedy conversion, one should ensure that all the required documents are submitted.

No. As the company’s PAN details remain same, there is no need of new registration. However, application of modification must be made for name change in records. LegalWiz.in can help you apply for modification at an additional cost.

Convert Private Limited to Public Limited

Know about Conversion of a Private Limited Company into Public Limited Company

Benefits of Conversion of Private Limited into Public Limited