What is Private Limited Company ( PVT LTD )?

A Pvt Ltd firm, also known as a private limited company, is a type of business structure that offers limited liability protection to its shareholders. In a Pvt Ltd firm, the liability of the shareholders is limited to the amount of their investment in the company. Pvt Ltd firms are governed by the Companies Act, 2013, and require a minimum of two shareholders and two directors. Pvt Ltd firms offer several advantages, including limited liability, separate legal entity status, easy access to funding, and perpetual succession. Pvt Ltd firms are ideal for medium-sized and large businesses looking for growth and expansion opportunities, and they offer a professional and credible image to customers, suppliers, and investors.

• Advantages :

  1. Limited liability: Pvt Ltd firms offer limited liability protection to its shareholders, which means that their personal assets are protected in case of any financial loss or legal issues.

  2. Separate legal entity: Pvt Ltd firms have a separate legal entity status, which means that the company is separate from its shareholders, allowing it to own assets, enter into contracts, and take legal actions on its own behalf.

  3. Easy access to funding: Pvt Ltd firms can easily raise funds from investors and financial institutions by issuing shares, debentures, or other securities, making it an ideal choice for businesses looking for growth and expansion opportunities.

  4. Perpetual succession: Pvt Ltd firms have perpetual succession, which means that the company can continue to exist even after the death or exit of its shareholders, ensuring continuity and stability of the business.

  5. Professional and credible image: Pvt Ltd firms offer a professional and credible image to customers, suppliers, and investors, making it easier to build trust and establish a strong reputation in the market.