Company Number: 14680700

Analysis Date: 2025-07-20 15:58 UTC

1. Risk Rating: HIGH
   Anda Hydraulics Co., Ltd shows persistent negative net assets and net current liabilities over three consecutive financial years, indicating solvency issues. The company is a micro-entity with minimal financial buffer, suggesting elevated financial risk.

2. Key Concerns:

• Negative Net Assets and Working Capital Deficits: The company has net liabilities of £1,617 as of FY 2025 and negative net current assets of £2,617, implying it cannot currently cover short-term obligations from current assets.
• Minimal Operational Scale: With only 1 employee on average and micro-entity accounting, the business scale is very small, possibly limiting operational sustainability and growth prospects.
• Concentration of Control: The sole director and 75-100% shareholder is the same individual, which may raise governance and succession risk concerns, especially given the company’s financial difficulties.

3. Positive Indicators:

• Compliance with Filing Requirements: The company has filed accounts and confirmation statements on time, indicating regulatory compliance and good administrative governance.
• Clear Industry Focus: The company operates in fluid power equipment and steel pipe manufacturing, established sectors with potential niche opportunities if financial issues are resolved.
• No Signs of Insolvency Proceedings: The company status is active, with no liquidation or administration noted, implying ongoing operations.

4. Due Diligence Notes:

• Investigate the nature and cause of recurring net liabilities and negative working capital—are these due to start-up phase losses, undercapitalization, or operational inefficiencies?
• Assess cash flow statements and bank facilities (not provided) to evaluate liquidity beyond balance sheet snapshots.
• Review contracts, customer base, and supplier terms to understand operational viability and prospects for turning around financial health.
• Verify the director’s plans for recapitalization or restructuring given the persistent net liabilities.
• Confirm no related party transactions or loans that may affect financial position or introduce conflicts of interest.