Company Number: 12784087

Analysis Date: 2025-07-20 11:55 UTC

1. Risk Rating: MEDIUM

Justification: Aavya Properties Ltd shows a solid net asset base (£2.76m) primarily backed by significant fixed assets (£7.39m), which suggests long-term asset strength. However, the company has very high current liabilities (£4.64m) relative to current assets (£42k), indicating potential liquidity pressure. The micro-entity filing status implies minimal financial disclosure, limiting transparency. The absence of overdue filings and a stable director base are positive, but the large short-term liabilities warrant caution.

2. Key Concerns:

• Liquidity risk: Current liabilities overwhelmingly exceed current assets by a large margin, raising concerns about the ability to meet short-term obligations.
• High leverage: Creditors falling due after more than one year also remain substantial (£4.64m), which could constrain financial flexibility.
• Limited financial disclosure: As a micro-entity, the company provides minimal narrative and no audit, reducing insight into operational performance or cash flow generation.

3. Positive Indicators:

• Consistent net asset growth: Shareholders’ funds have increased steadily from £2.43m in 2020 to £2.76m in 2024.
• Fixed asset base: Substantial investment in property assets aligns with the company’s real estate SIC codes and suggests underlying asset value.
• Compliance: No overdue account or confirmation statement filings and stable director appointments indicate good regulatory compliance.

4. Due Diligence Notes:

• Investigate the nature and maturity profile of current and long-term liabilities to assess refinancing or repayment risk.
• Request management accounts or cash flow statements to evaluate liquidity and operational cash generation.
• Understand the valuation and marketability of fixed assets to confirm the realizable value supporting net assets.
• Review director backgrounds and related-party transactions, given the small number of key personnel who also control the company.
• Clarify business model sustainability and revenue streams given minimal turnover and limited public financial disclosures.