CS RED LIMITED

Executive Summary

CS Red Limited operates as a micro-entity within the UK real estate letting sector, holding significant fixed assets but reporting negative net equity and constrained liquidity, which diverges from typical sector financial health. Current market conditions of rising interest rates and regulatory pressures pose risks that may challenge its financial stability. The company functions as a niche, small-scale player with limited operational activity, positioning it behind more established real estate operators in competitive capability and financial resilience.

CS RED LIMITED - Analysis Report

Company Number: 13644072

Analysis Date: 2025-07-20 14:20 UTC

1. Industry Classification:
   CS Red Limited operates within SIC code 68209, classified as "Other letting and operating of own or leased real estate." This sector encompasses companies engaged primarily in managing, letting, and operating real estate assets either owned or leased. Key characteristics include capital-intensive fixed assets, reliance on property market conditions, and often stable but cyclical revenue streams linked to rental income and asset management. Companies in this sector may range from small-scale residential landlords to large commercial real estate operators.

2. Relative Performance:
   As a micro-entity, CS Red Limited’s financial metrics reflect a modest scale relative to industry norms. The company holds substantial fixed assets (£579,898 as of 2024) that likely represent property holdings. However, it reports net liabilities of £43,341 and negative shareholders’ funds, indicating an equity deficit. This contrasts with typical real estate operators who usually maintain positive net asset values, as real estate tends to appreciate or at least retain book value over time. The company’s current liabilities (£622,808) vastly exceed current assets (£1,727), resulting in negative net working capital, which is atypical for stable real estate businesses that generally manage liquidity carefully to meet short-term obligations. The absence of employees suggests outsourcing or minimal operational activity, consistent with a lean asset-holding entity rather than an active development or management firm.

3. Sector Trends Impact:
   The UK real estate letting sector is currently influenced by several dynamics: increasing interest rates, inflationary pressures raising operational costs, and fluctuating demand for both residential and commercial spaces post-pandemic. Rising borrowing costs may pressure companies with high debt levels, as appears to be the case here given the significant liabilities. Additionally, regulatory changes around tenant protections and environmental standards could increase compliance costs. On the positive side, asset appreciation in certain locations may bolster fixed asset valuations over time, although this is not reflected in the company’s recent accounts. The micro scale and negative equity position may limit the company’s ability to leverage growth opportunities or weather market downturns.

4. Competitive Positioning:
   Within the competitive landscape, CS Red Limited appears to be a niche player or possibly a newly established small-scale investor in real estate rather than a market leader or significant follower. The negative net assets and working capital shortfall highlight financial vulnerability compared to sector norms where firms maintain stronger balance sheets to support asset management and tenant services. The ownership and control concentrated in two directors who are also the primary shareholders suggest a closely held company, possibly operating with a private investment or family backing. The lack of employees could be a competitive weakness if the company aims to scale or provide comprehensive property management services, but may suit a low-overhead investment model focusing on asset holding rather than active operations.