HCDKB PROPERTY LTD

Executive Summary

HCDKB Property Ltd faces high financial risk due to significant liquidity shortfalls and a fragile solvency position despite recent slight equity improvement. The company’s heavy debt burden against property assets necessitates further analysis of cash flow and loan terms to fully assess viability. Regulatory compliance appears satisfactory, but operational sustainability remains uncertain without detailed profitability data.

HCDKB PROPERTY LTD - Analysis Report

Company Number: 13143597

Analysis Date: 2025-07-29 20:57 UTC

1. Risk Rating: HIGH
   HCDKB Property Ltd exhibits significant solvency and liquidity concerns due to very high current liabilities relative to cash and negative net current assets. The large long-term borrowings against relatively modest net assets further exacerbate financial risk.

2. Key Concerns:

• Liquidity Risk: The company has cash of only £9,938 against current liabilities of £698,426, resulting in net current liabilities of £688,488, indicating an inability to meet short-term obligations without refinancing or asset disposals.
• Solvency Risk: Despite an improvement in net assets to £15,667 in 2025, this figure is marginal and follows years of negative equity, reflecting a fragile capital base and heavy reliance on debt (bank loans of £1.67 million).
• Operational Stability: The company operates in buying and selling its own real estate with tangible fixed assets of £2.38 million, but absence of income statement data limits assessment of profitability and cash flow generation. Reliance on property value appreciation or sale proceeds to service debt poses risk in a volatile real estate market.

3. Positive Indicators:

• The company is current on filings, including accounts and confirmation statements, showing compliance with regulatory requirements.
• Fixed assets remain stable at £2.38 million, suggesting retained investment in property which could potentially be monetized.
• Directors have relevant industry experience (estate agent and property consultant), which may support operational management.

4. Due Diligence Notes:

• Obtain and review the full income statement and cash flow statements to evaluate operational profitability and cash generation capacity.
• Investigate the terms of bank loans, including maturity, covenants, and interest rates to assess refinancing risk or potential default triggers.
• Confirm market value and liquidity of the tangible fixed assets to understand collateral value and potential for asset disposal.
• Review director backgrounds for any past conduct issues or conflicts of interest not evident from current data.