Public Limited Companies are those companies where minimum number of members is seven and there is no restriction on the maximum number of members. A public limited company has most of the characteristics of a private limited company. A public limited company has all the advantages of private limited company and the ability to have any number of members, ease in transfer of shareholding and more transparency. Identifying marks of a public limited company are name, number of members, shares, formation, management, directors and meetings, etc.

Public Limited Companies in India are a destination point for Foreign Direct Investment (“FDI”), because, under Foreign Exchange Laws, these are the areas open for public limited companies to attract foreign loans and equity participation.

Separate Legal Entity:

A Public Limited Company having its distinct identity from its members. A company is a separate person having its own rights & Obligations.

Limited Liability:

Limited Liability means the status of being legally responsible only to a limited amount for debts of a company. It is not like partnership and proprietorship firm, in a limited liability company the liability of the members is limited in respect of the company’s debts.

Borrowing Capacity:

A company can issue debentures, secured as well as unsecured and can also accept deposits from the public, etc.

Perpetual Existence:

In company law, perpetual successionis the continuation of a Company or other organization’s existence despite the death, bankruptcy, insanity, change in membership or an exit from the business of any owner or member. Thus the life of the company does not depend upon the life of its members.

Increased Trust and prestige:

A Public Limited Company enjoys greater trust of public because its accounts are published and it operates under statutory regulation and control. Shares of a Public Limited Company are traded on Stock Exchanges.

Democratic Management:

Everyone is given the opportunity to participate, ideas are exchanged freely, and discussion is encouraged. Shareholders can elect and remove directors. They exercise control over management in general meetings of the company.