+91- 93107 66086
·
info@taxmother.com
·
Mon - Sat 10:00-19:00
Free Consultation

Increase Authorised Share Capital

Unlocking Growth Potential through Increased Authorized Capital
INCREASE AUTHORISED CAPITAL

    The 2013 New Companies Act empowers businesses by allowing them to determine their authorized share capital without any mandatory minimum capital increase requirement. Through the board’s approval of an ordinary resolution, businesses can issue additional shares or increase their authorized share capital, enabling growth, expansion, and the pursuit of strategic objectives.

    • Increasing the authorized capital allows a company to unlock its growth potential and pursue expansion opportunities.
    • It enhances the company's borrowing capacity, making it more attractive to lenders and financial institutions.
    • A higher authorized capital can attract potential investors and foster strategic partnerships.
    • Increasing the authorized capital future-proofs the company by providing the necessary resources and flexibility to adapt to changing market conditions.

    Authorized capital empowers a company to raise more capital, enhances its borrowing capacity, and attracts potential investors. It provides the necessary foundation for growth, expansion, and financial stability, enabling the company to thrive in a competitive business landscape.

    • Flexible Capital Structure for GrowthUnlock the potential of your company by increasing authorized capital. With the ability to raise a higher amount of capital, you can fuel growth, pursue expansion plans, and seize new opportunities, shaping a flexible and dynamic capital structure.
    • Enhanced Financial Strength and Investor AppealElevate your company's financial standing with increased authorized capital. Benefit from an improved borrowing capacity, attracting favorable financing options. Additionally, a higher authorized capital acts as an invitation for potential investors, fostering collaboration and driving investor appeal.

    Increasing the authorised share capital of a company involves following a series of procedures. Here is a simplified version of the steps:

    1. Verify Articles of Association (AOA):
    Ensure that the AOA of the company contains provisions for increasing the authorized share capital. If necessary, make amendments to the AOA before proceeding.

    2. Convene a Board Meeting:
    Issue a notice to the directors and convene a Board meeting to seek their approval for increasing the authorized share capital.

    3. Extraordinary General Meeting (EGM):
    Fix a date for conducting an EGM to obtain approval from the shareholders for increasing the authorized share capital and make changes to the Memorandum of Association (MOA).

    4. Notify Shareholders:
    Present the notice of the EGM to all shareholders, directors, and auditors of the company, and obtain the necessary approvals from them.

    5. Conduct EGM:
    Hold the EGM as scheduled, where shareholders vote on the proposed increase in authorized share capital. The approval should be in the form of an ordinary resolution.

    6. File ROC Forms:
    Within 30 days of passing the ordinary resolution, file Form SH7 with the Registrar of Companies (ROC). Pay the prescribed government fee and attach the required documents, such as the EGM notice, a copy of the ordinary resolution, and the amended MOA reflecting the higher authorized capital.

    7. Approval and Reflecting Changes:
    Upon following the procedures specified in the Companies Act and Companies Rules, the Registrar will approve the filing, and the authorized share capital of the company will be increased. The updated authorized share capital will be reflected on the Ministry of Corporate Affairs (MCA) portal.

    8. Allotment of Shares:
    Once the authorized share capital is increased, the company can issue fresh equity shares to increase the paid-up share capital.

    Please note that this is a general overview, and it is advisable to consult with a legal or financial professional to ensure compliance with specific legal requirements and regulations pertaining to your jurisdiction and company type.

    For further inquiries or assistance regarding the process to increase authorised share capital, please feel free to contact our team.

    We are here to help you navigate through the procedures and provide you with the necessary guidance. Reach out to us today for expert advice and support.

    Contact Us