New Company Registrations Surge By 29% In May 2025; Signalling Strong Economic Momentum

India’s new company registrations climbed 29% year-on-year in May 2025, reaching 20,718, signalling a strong upswing in economic activity during the initial months of the financial year 2025-26.

This robust increase follows an all-time high of 23,776 new registrations recorded in April 2025, although registrations dipped 13% month-on-month in May.

The Ministry of Corporate Affairs (MCA) reported that the total number of active companies grew by more than 10% annually, reaching 1.89 million—the highest level ever recorded.

This surge underscores the expanding corporate base in the country, supported by regulatory reforms and an improved ease of doing business.

Sectoral breakdown of new registrations

Analysis of the sector-wise distribution of newly registered companies reveals that firms engaged in community, personal, and social services constituted the largest share, accounting for 27% of the total registrations.

This trend has persisted over several months, reflecting growing demand for services in these areas.

Trading companies formed the next largest category, comprising 17% of new registrations, followed by the manufacturing and business services sectors, which together accounted for 15%.

These sectors remain critical drivers of India’s economic growth and job creation.

The MCA bulletin highlighted the geographical distribution of new registrations, with Maharashtra leading at 17%, followed by Uttar Pradesh at 11%, and Delhi close behind at 9%.

These three states continue to dominate the business registration landscape, reflecting their strong industrial and commercial ecosystems.

Among different business structures, Limited Liability Partnerships (LLPs) showed notable growth, outpacing other registration types with a 19.6% year-on-year increase.

One-person companies followed closely with 19.2% growth, while foreign company registrations recorded a modest 1.2% rise.

The service sector accounted for the majority of LLP registrations in May, contributing 24%, followed by the industry and agriculture sectors at 2%.

This distribution indicates the growing prominence of service-oriented LLPs within India’s business ecosystem.

Private vs Public Limited Companies

Private limited companies constitute 96% of all registered companies in India, though their combined paid-up capital represents only 38% of the total capital across all firms.

In contrast, public limited companies make up just 4% of the total number but hold a dominant 62% share of the overall paid-up capital.

This disparity reflects the scale and capital intensity of public limited entities compared to private firms.

Experts attribute the surge in new registrations to an improved business environment, reduced regulatory barriers, and efficient registration procedures.

This positive trend is expected to continue, supporting India’s economic expansion and entrepreneurial growth throughout FY26.

This report from the Ministry of Corporate Affairs underscores India’s ongoing transformation into a vibrant business hub, with increasing company formations signalling confidence in the country’s economic prospects and governance reforms.

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