LTD vs Pvt LTD Companies
A company is called private limited when all its shares are in private hands. Pvt Ltd Company is owned by a group of promoters. On the other hand, the shares in a Public Limited company are open to everyone. The company is not in the hands of a few promoters but the public owns it.
There is also difference in the number of shareholders in the two types of companies. In Private Limited companies, the minimum number of shareholders should be two and the maximum 50. On the other hand, the minimum number of shareholders in a Public Ltd Company is seven and there is no limit to the maximum number of shareholders.
When talking of shares, the shares can be freely transferred in a Public Limited Company whereas it is not possible in a Private Limited company. If ever the shares of a Pvt Ltd company have to be transferred, the consent of the shareholders must be sought. Pvt Ltd Company cannot make a public offer of its shares. On the contrary, Ltd companies can make a public offer through advertisements.
The shares of a Limited company are listed in the stock exchange whereas it is not in the case of Private Limited Company. This means that trading happens with a Ltd company in the stock exchange and nothing of that sort happens with a Pvt Ltd company.
A Private Limited company is a partnership firm where as Public Limited company is a full-fledged corporate body.
What is LTD Company?
Ltd. or Limited refers to a public limited company is a company in which the shares of the company are in the hands of the public. A Ltd company is open to everyone who wants to buy shares in it. It has to be transparent in its transactions and records and other activities. According to the Companies Act, a public company can only write Ltd after the name of their company and not public Ltd.
In a public Ltd company, the minimum number of shareholders must be seven while it has no limit for the maximum number of shareholders. The minimum capital requirement to start a public Ltd company is 500000. A public company must have at least three directors.
A public company is listed on the stock exchange list, therefore, the transfer of shares takes place through the buying and selling in the stock market. A public company has the right to issue further shares to the existing shareholders after their approval.
A public limited company needs approval from the registrar of companies for the commencement of any business. It has to be transparent in its transactions and records and other activities. A public company needs to issue a statement in the public to show its transactions and decisions.
What is Pvt LTD Company?
Pvt Ltd or Private Limited company is a company in which the shares of the company are held only by a group of individuals. A private limited company is not open to the public. According to the Companies Act, a private limited company is liable to some exemptions and privileges.
In a private limited company, the minimum number of shareholders is two while the maximum number of shareholders is 50. The minimum capital required to start a private limited company is 100000. A private limited company must have at least two directors.
To conduct any business a private limited company does not require approval from the governmental authorities. The owner of the company is free to make decisions related to the company. A private limited company is not forced or bound to issue statements to show their transactions and activities.
Comparison Table Between LTD and Pvt LTD Companies
|Parameter of Comparison||LTD||Pvt LTD|
|Shareholders||In a public limited company, the shares are held by the public and are open to everyone.||In a private limited company, shares are held by the private promoters.|
|Minimum number of shareholders||A Ltd company requires at least seven shareholders in the company.||A Pvt Ltd enterprise requires at least two shareholders.|
|Maximum number of shareholders||A public Ltd company has no upper limit for the number of shareholders.||A Pvt Ltd company can have a maximum of 50 shareholders.|
|Transfer of shares||The transfer of shares in a public limited company is done through the stock market.||The shares of a private limited company are generally confined within a group of people and therefore are transferred with the approval of all shareholders.|