Characteristics of a private company.
What Are The Characteristics Of Public And Private Limited Company?
Public Limited Company :they can sell their shares to the general public. They provide more information because they provide their own prospectus. They can raise more capital. Public limited companies often have 'PLC' at the end of their name whereas pvt usually have 'LTD'. It has limited liability and a continuous existence . However they can sell their shares to general public . This increase the number of potential shareholders and the ability of their shareholders to sell their shares on the stock exchange
A private limited company is the one which is owned by a group of people. The capital in such a company is only contributed by the owners and shares cannot be issued to the general public. The shares of a private limited company are not traded on the stock exchange. These companies are usually smaller in size as compare to public limited companies. Moreover, the profits are only shared among the shareholders.
A public limited company is listed on the stock exchange and its shares are traded on the stock exchange. Public limited company can raise the funds from the public by issuing authorized shares. These companies have a minimum share capital and they must have minimum two directors. Such companies offer liquidity to the shareholders therefore, it can easily raise the capital. Moreover, the companies have to give accurate and reliable information to the investors.
A public limited company is listed on the stock exchange and its shares are traded on the stock exchange. Public limited company can raise the funds from the public by issuing authorized shares. These companies have a minimum share capital and they must have minimum two directors. Such companies offer liquidity to the shareholders therefore, it can easily raise the capital. Moreover, the companies have to give accurate and reliable information to the investors.
Characteristics of public company?
A public limited company is a type of limited company in which the shares are offered for sale to the public. A private limited company is limited by shares or by guarantee.
This type of company does not have the share capital but it is guaranteed by members who agree to pay a fixed amount in the event of liquidation.
A limited liability company is a legal form of business which offers limited liability to the owners. It is similar to a corporation, and even more flexible. See here for more information:Types of businesses
This type of company does not have the share capital but it is guaranteed by members who agree to pay a fixed amount in the event of liquidation.
A limited liability company is a legal form of business which offers limited liability to the owners. It is similar to a corporation, and even more flexible. See here for more information:Types of businesses
Private Limited Company
Private limited company is something
that is closely held . Like you cannot advertise your offer to subscription
shares in newspapers. You will have to sell the shares personally to your
family members or someone who is going to fund capital for you .
You need minimum 2 members , 2 directors and minimum paid up
capital of 1lakh .
There is considerable less restrictions on private company
than on public company (it is not that significant)
You cannot sell shares in share market , you have to sell it
back to the company (if the company buy backs) or you can sell it to some other
member (with permission ) or some outsider (with permission )
Public Limited Company
Public limited on other hand
Requires 7 members
Minimum paid up capital of 5 lakh.
Shares can be offered to public by sending prospectus.
They can be sold to anyone by just making an application.
They can be sold on stock exchange market only if the company
is listed
If the company is listed then you have to follow guidelines
by SEBI (Securities Exchange Board of India)
Minimum No. Of
shareholders:
Private Company: 2
Public Company: 3
Ceiling limit on Number of
Shareholder:
Private Company: 200
Public Company: No limit
provided
Transferability of shares:
Easier in case of Public
Company as many restriction are laid in Private Company.
Minimum Number of
Directors:
Private Company: 2
Public Company: 3
Issue of shares/securities
to public:
Private Company: Prohibited
Public Company: Allowed
subject to following provisions
Suffix:
Private Company: Private
Limited Company
Public Company: Public
Limited Company
Before choosing
the type of Company, one shall consult a professional who can guide you on the
basis of requirements of business and activities to be carried on.
You may contact Greenleaf for any further clarification and
Incorporation of the Company. To make the process simple, affordable and
hassle-free, please contact us at 9962071988or drop an e-mail for
consultation with experienced professionals.
