Company Number: 13437610

Analysis Date: 2025-07-20 16:38 UTC

1. Credit Opinion: DECLINE
   DR BALA LTD’s financial profile raises concerns about its ability to service debt obligations reliably. The company exhibits a sharp deterioration in working capital and net assets in the latest year, with net current assets turning negative (£-516) from a previous positive position (£4,516 in 2023). This signals liquidity stress. The minimal share capital (£100) and very low net assets (£167) reduce the buffer against adverse events. The absence of employees suggests a very small operation, likely dependent on the sole director’s activity. Given these points, the company’s creditworthiness is weak, and extending credit would carry elevated risk.

2. Financial Strength:
   The balance sheet reveals declining financial strength over three years. Fixed assets are negligible and declining (£854 to £683). Current assets remain stable around £44k, but current liabilities increased significantly from £39,686 in 2023 to £44,715 in 2024, pushing net current assets into negative territory. Total net assets have plummeted from £5,370 in 2023 to £167 in 2024, indicating erosion of equity and limited financial resilience. Shareholders funds mirror this decline. The company’s micro-entity status and limited capital structure imply limited capacity to absorb losses or invest in growth.

3. Cash Flow Assessment:
   The negative net current assets position suggests potential cash flow constraints. Although current assets are stable, the rise in current liabilities suggests pressure on short-term obligations. The company’s working capital is insufficient to cover immediate debts comfortably. Moreover, the absence of employees and limited fixed assets imply limited operational scale and possibly constrained cash generation capability. There is no disclosed information on cash or bank balances, but the overall liquidity position appears tight and warrants caution.

4. Monitoring Points:

• Liquidity trends: Watch for further deterioration in net current assets and any late payments to suppliers or creditors.
• Profitability and cash generation: Monitor any filed profit and loss data or cash flow statements to confirm if operations generate positive cash flows.
• Changes in liabilities: Track increases in short-term liabilities that could exacerbate liquidity risks.
• Director’s involvement: Given the single director structure, any change in management or operational focus could significantly impact performance.
• Filing compliance: Maintain oversight of timely accounts and confirmation statement filings to avoid regulatory penalties.