Converting a Private Limited Company into a Public Limited Company is a strategic move often taken to expand operations, raise capital, list on stock exchanges, or bring wider public participation.
This conversion requires compliance with the Companies Act, 2013—including alteration of company documents, shareholder approval, and filings with the Registrar of Companies (ROC).
This Saving Mantra guide provides a simple, complete, and practical step-by-step workflow to complete the conversion successfully and legally.
1. Understanding the Need for Conversion
A Private Limited Company may convert into a Public Limited Company for reasons such as:
- Expanding business operations
- Raising equity capital from the public
- Attracting investors, VCs, PE funds
- Enhancing brand credibility
- Meeting business model requirements
A Public Limited Company enjoys greater access to capital but must meet higher compliance and governance standards.
2. Key Changes in Conversion
When a Private Company becomes a Public Company:
- The word “Private” must be removed from the company name.
- Restrictions in Articles of Association (AOA) about share transfer and number of members must be deleted.
- The minimum number of directors becomes 3 (instead of 2).
- Minimum number of shareholders becomes 7.
3. Step-by-Step Conversion Process
Step 1: Board Meeting & Approval
A Board Meeting must be held to:
- Approve conversion into a Public Limited Company
- Approve alteration of MOA & AOA
- Approve change of name (removal of “Private”)
- Approve calling of the Extraordinary General Meeting (EGM)
- Approve draft notice of EGM with explanatory statement
- Authorize a director/CS to file necessary forms
Step 2: Issue Notice of Extraordinary General Meeting (EGM)
A 21-day notice must be issued to:
- Shareholders
- Directors
- Auditors
The notice includes the agenda for conversion and altered MOA/AOA draft.
Step 3: Hold EGM & Pass Special Resolutions
In the EGM, shareholders must approve:
- Conversion of company type
- Change in company name
- Alteration of MOA (Name Clause)
- Alteration of AOA (removal of Private-company restrictions)
A Special Resolution is mandatory.
Step 4: File Form MGT-14 with ROC
Within 30 days of passing the Special Resolution, file MGT-14 with the following attachments:
- Copy of Special Resolution
- Notice of Meeting + Explanatory Statement
- Altered MOA and AOA
- Certified copy of minutes
Step 5: File Form INC-27 (Application for Conversion)
After filing MGT-14, submit Form INC-27 for conversion approval.
Attachments include:
- Special Resolution
- Altered MOA & AOA
- Minutes of EGM
- Declaration by directors
- List of members & directors
- Updated company details
ROC examines the application and may request clarifications.
Step 6: Approval from Registrar of Companies (ROC)
If all documents are accurate and compliant, ROC:
- Approves the conversion
- Issues a Fresh Certificate of Incorporation
- Updates the MCA database reflecting the change
The company now officially becomes a Public Limited Company.
Step 7: Post-Conversion Compliance
Once the conversion is approved, the company must:
- Update PAN, TAN, GST, bank records
- Revise letterheads, website, signage, and statutory books
- Notify stakeholders, vendors, and government agencies
- Re-register licenses if required
- Increase the number of directors/shareholders (if below minimum)
4. Documents Required for Conversion
Company Documents
- Certificate of Incorporation
- MOA & AOA
- Board Resolution
- Draft altered MOA/AOA
- Special Resolution with explanatory statement
- Minutes of the EGM
Other Requirements
- List of members & directors
- Consent from directors
- Updated share capital details
- Declaration of compliance (director/CS)
5. Key Legal Requirements
- Company must have minimum 7 shareholders.
- Company must have minimum 3 directors.
- Name must not resemble existing public companies.
- Articles must comply with Public Limited Company provisions.
6. Benefits of Converting to a Public Limited Company
- Ability to raise funds from the public
- More credibility and transparency
- Easier access to loans and financial institutions
- Better corporate governance
- Potential for listing on stock exchanges
- Wider market presence
However, public companies must follow stricter compliance norms.
Conclusion
Converting a Private Limited Company into a Public Limited Company is a strategic decision that enables growth, investment, and expansion. With proper documentation, resolutions, and timely MCA filings, the process becomes simple and legally compliant.
The information provided in this blog is for general informational and educational purposes only and should not be construed as legal, tax, or professional advice. While every effort has been made to ensure accuracy and compliance with the applicable provisions of the Companies Act, 2013 and related rules, laws and regulations may change over time and interpretations may vary based on specific facts and circumstances. All services are subject to applicable laws, rules, and government approvals prevailing at the time of execution.