Prospectus and Capital Subscription

Meaning of Prospectus. Section 2(70) of the Companies Act, 2013 defines a prospectus broadly as any document described or issued as a prospectus, and includes a red herring prospectus, a shelf prospectus, or any notice, circular, advertisement or other document inviting deposits from the public, or inviting offers from the public for the subscription or purchase of any securities of a company. Only a public company raising capital from the public issues a prospectus — a private company is legally barred from inviting the public to subscribe for its shares or debentures, so this stage does not arise for it.

Contents of a Prospectus. As required under Section 26 read with the relevant Schedule, a prospectus must disclose, among other things:

• the name and registered office address of the company;
• the main objects and present business of the company;
• the names, addresses and other particulars of the directors and promoters;
• the nature and number of shares or debentures being offered, and the minimum subscription;
• the dates on which the subscription list opens and closes;
• details of the company's capital structure; …