Company Number: 13878973

Analysis Date: 2025-07-20 13:33 UTC

1. Risk Rating: MEDIUM
   Justification: The company has demonstrated a turnaround from negative net assets (£-1,508) in the previous two years to positive net assets (£5,247) as of 2024, indicating improved solvency. However, as a micro-entity with limited fixed assets (£3,000) and modest working capital (£3,447), the financial buffer remains thin. The company is very young (incorporated in 2022) with a small employee base (2 on average), which may imply operational and market risks typical for startups. There are no overdue filings or liquidation status, which supports regulatory compliance.

2. Key Concerns:

• Volatility in Net Assets: The company moved from negative net assets in 2022 and 2023 to positive in 2024, suggesting instability in capital structure or profitability that needs monitoring.
• Limited Asset Base and Working Capital: Fixed assets are minimal, and net current assets, while positive in the latest year, are modest (£3,447), potentially limiting liquidity to meet unexpected obligations.
• Director Changes and Control Concentration: Recent rapid changes in directors (appointment and resignation on the same day for one director) and control heavily concentrated in a single individual (Mrs Eman Kumar with 75-100% shares and voting rights) could pose governance or operational continuity risks.

3. Positive Indicators:

• Compliance with Filing Requirements: No overdue accounts or confirmation statement filings, indicating good regulatory compliance.
• Improved Financial Position: Turnaround to positive net assets and net current assets suggests improving financial health and ability to meet short-term obligations.
• Clear Business Focus and Industry: Operating in the hairdressing and beauty treatment sector (SIC 96020), a stable service industry with local demand, supported by a small but growing workforce.

4. Due Diligence Notes:

• Review detailed profit & loss information and cash flow data (not filed) to assess profitability trends and liquidity beyond balance sheet snapshots.
• Investigate the reasons behind director appointments and resignations, particularly the same-day resignation of Mrs Eman Kumar, to understand governance dynamics.
• Confirm the identity and role consistency of people with significant control, given apparent overlap in names and control rights, to ensure clarity on ownership and decision-making.
• Assess the sustainability of the business model in the local market, given its micro status and limited asset base.