DIGITAL GROWTH FACTOR PRIVATE LIMITED

Executive Summary

Digital Growth Factor Private Limited currently faces high solvency and liquidity risks due to significant negative net assets and reliance on director loans. While regulatory filings are up to date and the company shows some investment in assets, the mismatch between dormant status and operational activity requires clarification. Further due diligence is necessary to evaluate business sustainability and the director's financial support.

DIGITAL GROWTH FACTOR PRIVATE LIMITED - Analysis Report

Company Number: 13616638

Analysis Date: 2025-07-20 15:41 UTC

1. Risk Rating: HIGH

Justification: The company exhibits significant negative net assets and net current assets as of the latest financial year, indicating solvency concerns. The current liabilities substantially exceed current assets, suggesting liquidity risk. The company is classified as dormant yet shows activity in the accounts, which may indicate operational or compliance irregularities.

2. Key Concerns:

• Solvency and Liquidity: As of 30 September 2024, net current liabilities stand at £19,525 with net assets negative at £15,633, primarily due to director loans (£24,814) classified as current liabilities. This suggests the company depends on director funding and has limited resources to meet short-term obligations.
• Operational Activity vs Dormant Status: The company is categorized as dormant but has tangible fixed assets and recorded debtors, indicating some operational activity. This inconsistency may raise questions about the accuracy of filings or the company’s business sustainability.
• Lack of Employees and Revenue: No employees were reported during the year, and there is no indication of turnover or sales revenue. This absence of operational scale may affect the company's ability to generate cash flow and sustain operations.

3. Positive Indicators:

• Compliance with Filings: The company is up to date with its accounts and confirmation statement filings, with no overdue returns, indicating reasonable regulatory compliance.
• Director Control and Stability: The sole director and 75-100% shareholder is consistent, which may simplify governance and decision-making.
• Tangible Fixed Assets: The addition of computer equipment (net book value £3,892) suggests some investment in operational capacity.

4. Due Diligence Notes:

• Investigate the nature and terms of the director loan (£24,814), including repayment plans and whether it is expected to be converted to equity.
• Clarify the apparent discrepancy between dormant classification and reported operational activity (fixed assets, debtors).
• Review any trading activity or revenue streams not disclosed in the accounts to assess business sustainability.
• Confirm the company’s business model and the plan to address the negative equity position.
• Assess the director’s financial standing and commitment, given the reliance on director loans.