1. Minimum Shareholding Requirement

• A Public Limited Company must have at least 7 shareholders at the time of incorporation.
  
• This is a mandatory requirement under the Companies Act, 2013.
  
• These shareholders can be individuals or corporate entities.
  
• All shareholders must agree to subscribe to the company’s Memorandum of Association.
  
• The number cannot fall below 7 during the existence of the company.
  

2. Maximum Number of Shareholders

• There is no upper limit on the number of shareholders in a Public Limited Company.
  
• The company can offer its shares to the general public.
  
• This unlimited scope allows broad-based ownership and large-scale fundraising.
  
• It enables institutional and public investors to participate.
  
• The open structure supports listing on stock exchanges.
  

3. Types of Shareholders Allowed

• Shareholders can include individuals, companies, or other legal entities.
  
• Both Indian and foreign nationals/entities can be shareholders.
  
• Shares can be issued to retail investors, institutions, and the general public.
  
• Shareholders may hold equity or preference shares depending on the issuance.
  
• Voting rights depend on the type and number of shares held.
  

4. Role in Company Formation

• Shareholders are initial subscribers to the company’s capital.
  
• Their names appear in the company’s incorporation documents.
  
• They sign the Memorandum and Articles of Association.
  
• They contribute to the initial capital required at registration.
  
• A shareholder agreement may define rights and obligations in detail.
  

5. Shareholders vs. Directors

• Shareholders are owners; directors manage daily operations.
  
• A minimum of 3 directors is also required for a Public Limited Company.
  
• One person can be both a shareholder and a director.
  
• Directors are appointed by shareholders through a resolution.
  
• Shareholder rights include voting, dividends, and attending AGMs.