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LIMIT TO INVEST IN SH & MF BY CO.
is there any limit/or how much can be invested in shares & mf by a Pvt Ltd. co. and Public Co. whose core business is other than investments?
Replies (3)
NO LIMIT
no. there isn't any.
While investing in shares of other body corporates , a public limited company has to comply with Sec 372A of the Companies Act i.e a company cannot invest an amount exceeding the higher of:
a) 60% of the paid up share capital and free reserves
OR
b) 100% of the free reserves.
If the Co. wants to invest more than the aforesaid limit then a special resolution has to be passed before doing so.
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