AUJLA PROPERTIES LIMITED
Company number SC359329 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Credit Analysis: AUJLA PROPERTIES LIMITED (SC359329)
1. Credit Opinion: DECLINE
This application should be declined. The company is currently subject to a Proposal to Strike Off at Companies House, meaning it is in the process of being removed from the register. Extending credit to a company facing dissolution carries unacceptable risk — the entity may cease to exist, leaving debts unenforceable. Additionally, accounts are overdue, and the company exhibits a severe working capital deficit. No new credit facilities should be considered while the strike-off action is active and compliance failures persist.
2. Financial Strength
Balance sheet shows asset backing but critical structural weaknesses:
| Metric | 2024 | 2023 | YoY Change |
|---|---|---|---|
| Fixed Assets | £1,323,102 | £1,355,825 | -2.4% |
| Current Assets | £13,961 | £403,681 | -96.5% |
| Net Current Assets | (£663,965) | £28,018 | Severe deterioration |
| Net Assets | £655,097 | £419,271 | +56.3% |
Key concerns:
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Illiquid asset base: 98.9% of total assets are fixed assets (presumably investment property), which cannot be readily converted to cash. Current assets have collapsed from £403,681 to just £13,961.
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Net current liabilities of £663,965: The company cannot meet short-term obligations from current resources. This is a classic insolvency indicator on a liquidity basis.
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Debt reclassification risk: Long-term creditors fell dramatically from £923,187 to just £2,977, while current creditors surged from £375,663 to £677,926. This suggests debt has been reclassified as due within one year — potentially at a lender's demand — which heightens repayment risk.
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Historical insolvency: From 2015-2019, the company carried negative net assets (liabilities exceeding total assets). The recent improvement to positive net assets is encouraging but fragile given the liquidity position.
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Nominal share capital of £1: Provides virtually no cushion for creditors.
3. Cash Flow Assessment
The company faces a severe liquidity crisis:
- Current ratio: 0.02x (£13,961 / £677,926) — critically below the 1.0x threshold for solvency
- Cash position: In 2020 (last reported), cash was just £45. Given current assets of only £13,961, cash is likely negligible
- Working capital deficit: £663,965 — the company owes nearly £664k more in short-term debts than it can access
Assessment: The company appears dependent on rental income from its property portfolio to service debts. Any interruption to rental income (void periods, tenant default, maintenance costs) would immediately threaten debt servicing capability. With no cash buffer and no access to liquid assets, the company has zero margin for operational disruption.
4. Monitoring Points
If the strike-off action is resolved and the company seeks credit in future, the following require ongoing scrutiny:
| Metric | Risk Level | Rationale |
|---|---|---|
| Strike-off status | Critical | Must be resolved before any credit consideration |
| Accounts filing | High | Overdue accounts indicate compliance failure; monitor for continued timeliness |
| Current ratio | Critical | Track whether short-term liabilities are restructured or reduced |
| Cash position | High | Request management accounts to assess actual cash flow from rental income |
| Debt maturity profile | High | Understand whether creditors are demanding repayment; assess refinancing risk |
| Property valuations | Medium | Fixed assets underpin the balance sheet; monitor for impairment |
| Director changes | Medium | Recent director resignation noted; assess impact on management capacity |
| PSC control | Medium | Single individual (Bhadar Aujla) controls 75%+ — key-person dependency |
Additional Risk Factors: - The company files as a micro-entity, meaning minimal financial disclosure — no P&L, no cash flow statement, limited transparency - No employees — suggests passive property holding with potential management resource constraints - Director also serves as secretary, concentrating governance responsibilities