Introduction

Public Limited Companies (PLCs) are among the most significant business entities, allowing large-scale operations and access to various capital-raising options. In India, capital funding is crucial for business expansion, and companies rely on multiple methods such as Initial Public Offerings (IPOs), Follow-on Public Offerings (FPOs), Rights Issues, Preferential Allotments, and Qualified Institutional Placements (QIPs) to secure financial growth.

For businesses in Ludhiana and across India, understanding these funding strategies is vital, especially in compliance with SEBI (Securities and Exchange Board of India) regulations. Additionally, trademark registration consultants in Ludhiana play a key role in protecting a company’s brand identity, ensuring exclusive rights, and avoiding legal disputes.

This article explores the different strategies used by Public Limited Companies to raise capital while staying compliant with government norms.

Key Methods of Raising Capital for Public Limited Companies

1. Initial Public Offering (IPO)

An IPO is the process where a private company transitions into a publicly traded entity by selling shares to the public. This method allows companies to access capital markets and expand their business operations.

Process of an IPO:

• Preparation: Companies must prepare a Red Herring Prospectus (RHP), undergo financial auditing, and appoint underwriters.
• SEBI Approval: The company must submit the IPO proposal to SEBI for regulatory clearance.
• Marketing & Investor Awareness: Roadshows, investor meetings, and pre-IPO placements help generate market interest.
• Price Determination: The company can opt for a fixed-price or book-building approach.
• Listing on Stock Exchanges: Shares are finally listed and available for trading.

Recent IPO Trends in India

• The Indian IPO market is booming, with companies like Zomato, Paytm, and Nykaa setting records in recent years.
• In 2025, multiple Indian startups, including Groww, Pine Labs, and Lenskart, are expected to go public, raising billions of dollars.

2. Follow-on Public Offering (FPO)

An FPO is when a company that is already listed on a stock exchange issues additional shares to the public. This is done to raise extra funds after an IPO.

Advantages of an FPO:

• Investors are already familiar with the company.
• It is a more efficient and faster process compared to an IPO.

3. Rights Issue

A rights issue allows existing shareholders to purchase additional shares at a discounted price, ensuring that companies raise capital while maintaining shareholder value.

Recent Developments in Rights Issues:

• SEBI has proposed allowing companies to issue rights to new investors, which enhances flexibility and attracts more capital.

4. Preferential Allotment

In preferential allotment, shares are issued to specific investors rather than the public. These investors may include venture capitalists, private equity firms, or institutional investors.

Key Considerations:

• Companies must follow SEBI pricing guidelines to ensure fairness.
• There may be a lock-in period, restricting immediate resale of shares.

5. Qualified Institutional Placement (QIP)

A QIP is a fast-track capital-raising method where shares are sold only to qualified institutional investors. It is widely used by companies looking for quick funding without the lengthy regulatory process of an IPO.

Benefits of QIP:

• Faster process with reduced compliance burden.
• Institutional participation enhances market credibility.

Did You Know?

• SEBI increased the minimum investment requirement for SME IPOs to ₹200,000, attracting serious investors.
• India is set to break IPO records in 2025, with at least seven companies planning to raise $1 billion or more.

Why Is Trademark Registration Important for Public Companies?

While funding is essential for business expansion, protecting a company’s brand identity is equally important. Trademark Registration Consultants in Ludhiana help businesses secure their intellectual property, preventing unauthorized use and legal disputes.

Benefits of Trademark Registration:

• Exclusive Rights: Legally protects your brand name, logo, and slogan.
• Competitive Edge: Differentiates your brand from competitors.
• Prevents Infringement: Stops others from copying your brand identity.
• Increases Business Value: Enhances credibility, trust, and financial valuation.

Conclusion

Public limited companies in India have diverse funding strategies, including IPOs, FPOs, rights issues, preferential allotments, and QIPs, to raise capital efficiently. While capital-raising is crucial for business growth, trademark protection is equally vital in ensuring long-term success and legal security.

For expert guidance on capital funding, IPO compliance, and trademark registration, consult Lal Ghai & Associates, the leading trademark registration consultants in Ludhiana.

Contact Lal Ghai & Associates Today!

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