Company Number: 13879161

Analysis Date: 2025-07-29 14:53 UTC

1. Credit Opinion: DECLINE

MAJI Properties Ltd shows significant financial weakness with negative net assets of £3,395 at the latest year-end (31 Jan 2024) and a working capital deficit of £47,778. The company is heavily leveraged with long-term creditors of £87,500 and current liabilities of £110,727 against relatively modest current assets of £62,949. There is no indication of operating profit or retained earnings to support debt service, and the company is only two years old with limited financial history. Given the net liability position and poor liquidity, the company currently lacks sufficient financial strength to reliably service debt or meet commercial obligations without additional capital or support. Credit approval is not recommended at this stage.

2. Financial Strength

The balance sheet reveals a tangible fixed asset base of £131,883, presumably property, but this is largely offset by creditors totaling £198,227 (current plus long-term). Negative shareholders' funds (£3,399) indicate accumulated losses or initial capital erosion. No retained earnings are present to buffer financial shocks. The lack of debt repayment reserves or equity cushion demonstrates weak financial resilience. The company’s reliance on creditor funding and negative net assets raise concerns about solvency and ongoing viability without capital injection.

3. Cash Flow Assessment

Cash balance stands at £62,949 with no debtors, indicating limited incoming receivables. Current liabilities exceed cash and other current assets by nearly £48k, resulting in negative working capital. This suggests potential liquidity strain in meeting short-term obligations. No evidence of positive operating cash flow is available from provided data, and the absence of income statement details limits cash flow visibility. Overall, liquidity is insufficient to cover immediate liabilities without additional financing or asset sales.

4. Monitoring Points

• Monitor quarterly cash flow trends and liquidity ratios closely.
• Watch for changes in creditor balances and any new borrowing.
• Track any capital injections or equity increases to improve net assets.
• Review subsequent filing of profit and loss accounts for operational performance.
• Monitor market conditions in property sector impacting asset valuations and rental income.
• Observe director conduct and any changes in management strategy or control.