BEITZAM LIMITED

Executive Summary

Beitzam Limited is a newly incorporated real estate company with significant borrowings secured against its investment property assets. While the company complies with filing requirements and holds substantial assets, its high leverage and substantial negative working capital indicate elevated solvency and liquidity risks. Independent verification of asset values and detailed review of debt arrangements are recommended to better assess financial stability.

BEITZAM LIMITED - Analysis Report

Company Number: 15424025

Analysis Date: 2025-07-29 18:57 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity risks due to large borrowings relative to net assets and current liabilities substantially exceeding current assets.

2. Key Concerns:

• Negative Working Capital: Current liabilities (£2.24m) far exceed current assets (£76.8k), resulting in a net current liability of over £2.16m, indicating potential near-term liquidity issues.
• High Leverage: Total borrowings amount to £4.35m (including £4.05m long-term and £0.3m short-term bank loans) against net assets of only £23.4k, implying very high financial leverage and risk of insolvency under adverse conditions.
• Reliance on Investment Property Valuation: The company’s principal asset is investment property valued at £6.24m, based on director valuation without independent audit or market verification, which raises concerns about asset realizability and valuation accuracy.

3. Positive Indicators:

• Asset Backing: The company holds substantial investment property assets, which theoretically support the borrowings secured against them.
• No Overdue Filings: The company is current with account and confirmation statement filings, indicating compliance with regulatory requirements.
• Clear Ownership and Governance: The company’s directors and persons with significant control have been clearly disclosed, with no indications of disqualifications or governance issues.

4. Due Diligence Notes:

• Verify Investment Property Valuation: Obtain independent professional valuation to confirm the fair market value and liquidity of the investment property assets.
• Assess Borrowing Terms: Review loan agreements with HS Credit (Manchester) Ltd and group undertakings to understand covenants, repayment schedules, interest rates, and security arrangements.
• Examine Group Structure and Related Party Transactions: Since a large creditor is a group undertaking, investigate intercompany balances and potential support or risks related to group financial health.
• Cash Flow Projections: Evaluate the company’s rental income streams and operational cash flows to assess ability to service debt and meet short-term liabilities.
• Confirm No Undisclosed Liabilities: Given the high leverage, confirm that all liabilities have been disclosed and that there are no pending litigations or contingent liabilities.