DHEER MANAGEMENT LIMITED

Executive Summary

Dheer Management Limited, a recently incorporated real estate trading company, currently faces liquidity challenges and negative net assets despite a strong property asset base. The financial structure shows significant debt reliance and minimal equity, resulting in a below-average financial health score. Prompt action to improve working capital, restructure debt, and increase equity is recommended to stabilize and improve future financial resilience.

DHEER MANAGEMENT LIMITED - Analysis Report

Company Number: 15458995

Analysis Date: 2025-07-29 12:09 UTC

Financial Health Assessment: Dheer Management Limited

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1. Financial Health Score: D

Explanation:
Dheer Management Limited presents early signs of financial distress despite being a newly incorporated private limited company. The company's net liabilities, significant current liabilities, and negative shareholders’ funds signal "symptoms of distress." While it has valuable fixed assets (property), the company's liquidity is strained, and it is currently operating with negative working capital. This results in a below-average financial health grade.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets (Property)	443,293	Strong asset base, likely a key business focus.
Current Assets	6,245	Very low liquidity buffer; potential cash flow issues.
- Cash	3,937	Limited cash available for immediate obligations.
- Debtors	2,308	Low trade receivables; minimal short-term income expected.
Current Liabilities	136,019	High short-term obligations, mostly directors’ loans.
Net Current Assets	-129,774	Negative working capital; could impair day-to-day operations.
Long-Term Liabilities	314,980	Substantial bank loan; significant debt burden.
Net Assets / Shareholders’ Funds	-1,461	Negative net worth; liabilities exceed assets.
Share Capital	100	Minimal equity investment.

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3. Diagnosis

• Liquidity and Cash Flow:
  The company exhibits "unhealthy cash flow" symptoms with very limited cash reserves (£3,937) and a negative net current asset position (-£129,774). This implies difficulty in meeting short-term liabilities as they fall due, especially with £136,019 in current liabilities.

• Leverage and Solvency:
  With total liabilities exceeding total assets slightly (net liabilities of £1,461), the company is technically insolvent. The large bank loan (£314,980) compared to the equity base suggests a heavy reliance on debt financing, increasing financial risk.

• Asset Structure:
  The fixed assets consist predominantly of property (£443,293), which is a strong tangible asset. However, such assets are illiquid and cannot quickly be converted to cash to meet urgent obligations, exacerbating liquidity issues.

• Capitalization:
  The company shows minimal equity capital (£100), which is insufficient to absorb losses or provide a cushion against financial shocks.

• Business Stage:
  Being a newly formed entity (incorporated February 2024), these "symptoms" may partly reflect initial investment and setup phases rather than ongoing operational distress. However, the current financial structure requires careful management.

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4. Recommendations

• Improve Liquidity:
  Enhance working capital by either injecting more equity or restructuring current liabilities, especially the directors’ loan accounts, to extend repayment terms or convert some debt to equity if possible.

• Financial Planning and Cash Flow Management:
  Implement stringent cash flow forecasting and management to avoid liquidity shortfalls. Prioritize collection of debtors and control costs tightly.

• Debt Restructuring:
  Engage with lenders to possibly refinance or restructure the bank loan to reduce near-term repayment pressure.

• Equity Injection:
  Consider raising additional share capital to strengthen the balance sheet and provide a buffer against losses.

• Operational Review:
  As the company operates in real estate trading, review property acquisition and sales strategies to ensure profitability and healthy cash inflows.

• Regular Monitoring:
  Conduct frequent financial health check-ups to monitor vital signs and detect early symptoms of distress, enabling timely corrective actions.

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Medical Analogy Summary

Dheer Management Limited is currently showing "early warning signs" akin to a patient with low blood pressure (liquidity) and a heavy burden on the heart (debt). While the asset base (property) is strong—like a strong skeleton—the company’s cash flow is weak, which could lead to "financial shock" if not managed promptly. Immediate attention to liquidity and capital structure is essential to restore financial "health" and prevent deterioration.

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