Public limited company: meaning, requirements and uses
A public limited company needs at least 7 members and 3 directors and may invite the public to subscribe. It can list on a stock exchange under SEBI rules.
Short answer
A public limited company is a company that is not a private company, as defined in section 2(71) of the Companies Act, 2013. It needs at least seven members and three directors, has no cap on the number of members, and can invite the public to subscribe to its securities.
- Members
- Minimum 7, no maximum
- Directors
- Minimum 3
- Name ends with
- Limited
- Listing
- Possible, subject to SEBI regulations
How it differs from a private company
A public company's shares are freely transferable, and it can raise money from the public through a prospectus once it meets SEBI requirements. In return, it faces stricter rules on related party transactions, managerial remuneration, loans to directors and corporate governance. A subsidiary of a public company is also treated as public even if its articles describe it as private. Many of the relaxations available to private companies under the 2015 exemption notification do not apply.
Governance requirements
Certain unlisted public companies above the thresholds in the rules must appoint independent directors and a woman director and form audit and nomination committees. Listed companies must also comply with SEBI's listing regulations. Larger public companies need a whole-time company secretary, a secretarial audit and, where applicable, rotation of auditors. Board meetings must be held at least four times a year with no more than 120 days between two meetings.
Why it matters for startups
Few startups incorporate as public companies. Instead, a private company converts to public before an IPO, or when its member count must exceed 200. Conversion needs a special resolution, altered articles, at least seven members and three directors, and a filing with the ROC. Plan the governance changes, such as independent directors and committees, well before the conversion date.
Related services
Sources
Written by the Refogo Editorial Team from the official sources above and checked on 2026-10-31. Laws, rates and due dates change, and authorities often extend deadlines, so confirm your own case with a qualified professional. This is general information, not legal or tax advice. Read our editorial policy or report an error to support@refogo.com.
Common questions
Can a public limited company be unlisted?
Yes. Many public companies are unlisted. Listing is a separate step governed by SEBI.
What is the minimum capital for a public company?
There is no minimum paid-up capital requirement under the Companies Act, although SEBI sets eligibility norms for an IPO.
How long does it take to convert private to public?
It depends on ROC processing after the special resolution and Form INC-27 filing, so allow several weeks and do not rely on a fixed timeline.