INCREASE THE SHARE CAPITAL

A company may need to increase its authorized share capital before issuing new equity shares and increasing paid-up capital. Authorized share capital is the total value of shares a company can issue, while paid-up capital is the total value of shares the company has issued.

The company can increase its paid-up capital by issuing shares either to an existing shareholder or to any other person whether it is a public limited company or it is a private limited company.

 

Pre-requisites of increase in authorized capital

1. An Articles of Association must have a clause for an increase in authorized capital 
2. Shareholders’ approval is a must.

THE PROCEDURE TO INCREASE THE SHARE CAPITAL

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