If you are thinking of going public with your company, it is a fantastic thought. Conversion of a private limited company is an easy and straightforward process but it will take up to 30 to 35 days as it involves many steps.
Firstly, the articles of association need to be changed. After that, you have to delete the word private from your company name and begin the registration process. Finally, you will have to wait for the certificate of commencement of business. For a smooth process, you require three directors, seven shareholders and a paid-up capital of at least Rs. 5 lakhs.
Transfer of shares by the shareholders of a public limited company is very quick and straightforward process. They just need to file the share transfer form and then they can easily handover the share certificate to the designated buyer. The same process is very tedious in other business structures.
The main benefit of the public limited company is that you will be able to raise capital using shares from the general public. But it will require the listing on a stock exchange. Moreover, all public limited companies are authorized to issue fixed deposits, debentures, convertible debentures to the general public.
Public limited companies must reveal their audited statement of accounts. They should also inform the regulatory bodies of any structural change and need tohave annual general body meetings for all shareholders. It seems a very tedious process but these compliances bring uttermost credibility to a public limited company.