Can a newly incorporated Private Limited Company issue shares on Premium?

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Madhusmita Padal

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Mar 18, 2025, 4:00:49 AMMar 18
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Can a newly incorporated private Limited Company issue shares on Premium ? if yes, what is the process? Is there a requirement of valuation?

zalak talreja

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Mar 18, 2025, 4:02:09 AMMar 18
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Yes as per discounted value of shares certificate from MB.

Regards,
PCS Zalak Talreja
Zalak M T & Associates
Practising Company Secretary,
+91 812 88 68 370


On Tue, Mar 18, 2025 at 1:30 PM Madhusmita Padal <inboxma...@gmail.com> wrote:
Can a newly incorporated private Limited Company issue shares on Premium ? if yes, what is the process? Is there a requirement of valuation?

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Madhusmita Padal

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Mar 18, 2025, 4:11:18 AMMar 18
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Can someone help with us with the Valuation Report?

Priya Lohia

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Mar 18, 2025, 4:13:22 AMMar 18
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Yes

On Tue, 18 Mar 2025, 13:31 Madhusmita Padal, <inboxma...@gmail.com> wrote:
Can a newly incorporated private Limited Company issue shares on Premium ? if yes, what is the process? Is there a requirement of valuation?

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zalak talreja

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Mar 18, 2025, 4:14:02 AMMar 18
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yes 
contact us

Regards,
PCS Zalak Talreja
Zalak M T & Associates
Practising Company Secretary,
+91 812 88 68 370

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Priya Lohia

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Mar 18, 2025, 4:18:06 AMMar 18
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Yes
Please connect 

Thanks and regards 
Priya Mimani 

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FCA Chandrasekaran Ramadurai

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Apr 8, 2025, 9:33:42 AMApr 8
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Yes, a newly incorporated private limited company can issue shares at a premium, meaning at a price higher than their face value, as per the Companies Act, 2013. [1, 1, 2, 2, 3, 3]

Here's a more detailed explanation: [1, 1, 4, 4]
  • Legal Framework: The Companies Act, 2013, allows companies to issue shares at a premium, whether for cash or otherwise. [1, 1, 4, 4]
  • Commercial Decision: Issuing shares at a premium is a commercial decision and doesn't require any specific justification under the law. [1, 1, 5, 5]
  • Securities Premium Account: The excess amount received over the face value (premium) is transferred to a "securities premium account," which has specific uses outlined in the Act. [1, 1, 4, 4]
  • Uses of Securities Premium Account: The securities premium account can be used for: [4, 6, 7]
    • Issuing bonus shares to members. [4, 4]
    • Writing off preliminary expenses or expenses related to share/debenture issues. [4, 4]
    • Providing for premium payable on redemption of preference shares or debentures. [4, 4]
    • Purchasing the company's own shares or other securities. [4, 4]
  • No Valuation Certificate Required: There's no requirement for a valuation certificate when issuing shares at a premium. [1, 1, 8, 9]
  • Common practice: Issuing shares at a premium is a common practice among companies that boast an impressive financial record, efficient management, and a strong market reputation. [3, 3]

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