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What is the difference between a private and a public limited company?
Let’s take a look at the differences between a private and a public limited corporation.
Private Limited Company
A privately owned firm that caters to small companies. A private limited company’s shareholders’ responsibility is limited to the amount of shares they own. A private limited company’s stock cannot be sold.
Public Limited Company
A corporation whose stock is traded on a stock exchange and can be bought and sold by anybody. It’s also known as a publicly traded stock. A public limited corporation, as the name implies, is one that sells stock to the general public. A public limited corporation is one that has limited liability and sells company shares to the general public, according to the Company Act of 2013. Anyone can obtain a licence.
Transferring Files Quickly
A public limited company’s shareholders can easily pass their shares. What they have to do now is fill out the share conversion form and hand the buyer the share certificate. Transferring a share to a different corporate arrangement is a time-consuming operation.
Raise Funding
The benefit of a public limited company is that it can be used to collect money from the general public by issuing bonds. This will, though, necessitate a stock exchange listing. Set deposits, debentures, and convertible debentures may be issued to the general public by any public limited company.
More trustworthiness
Public limited corporations must publish their audited financial statements, notify regulatory authorities of any institutional changes, and hold annual general meetings open to all shareholders. The company gains a lot of prestige from these regulatory procedures.
