Increase Authorized Share Capital
The maximum amount of capital for which a firm may issue shares to its shareholders is known as authorized share capital. The company’s memorandum of association contains information about the allowed capital.
Overview
In other words, the maximum number of shares that a corporation can issue is determined by its authorized capital. A firm can increase its authorized capital at any moment by completing certain procedures.
For instance, Company ABC has issued shares for one lac rupees to its shareholders, while having an authorized capital of ten lacs. assuming that each share is worth 10 rupees. As of right now, the business has issued its stockholders 1,00,000/10 = 10,000 shares. The corporation currently has one lac in paid-up capital. Additionally, the business can issue new or existing owners with shares worth an additional 9 lac Rupees.
Benefits of Increasing Authorized Share Capital
Increases share capital
Only up to the share capital specified in the MOA may a business raise capital through equity shares. As a result, raising authorized share capital gradually raises total business share capital.
Enhances Borrowing Capacity
Only up to the share capital specified in the MOA may a business raise capital through equity shares. As a result, raising authorized share capital gradually raises total business share capital.
Checklist/Requirements
The company’s digital signature certificate of director, certificate of incorporation, certificate of association, and PAN card
Process of Increasing authorized Capital of the company
Step 1: Distribute the necessary information and documentation
Step 2: The board resolution is passed.
Step 3: Run the shared files.
Step 4: Submitting an electronic form to the ministry
Step 5: Government approval to raise the authorized share capital
Step 6: Distribute the outputs
Key Deliverables
- Updated the company’s MOA.
- Updates the company’s AOA.
Why Choose Us
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Every one of our experts is trained and skilled in that specific field. ensuring that no errors are made when filing with the authorities in order to prevent the company from incurring penalties for errors.
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