MAKAAN DEVELOPMENTS LTD

Executive Summary

Makaan Developments Ltd is a small private company with a stable investment property asset base but carries significant long-term debt with minimal equity buffer. Liquidity appears sufficient to meet short-term obligations, and regulatory compliance is maintained. However, the high leverage and concentration of control warrant careful monitoring of debt servicing capability and future operational sustainability.

MAKAAN DEVELOPMENTS LTD - Analysis Report

Company Number: 13126966

Analysis Date: 2025-07-20 17:35 UTC

1. Risk Rating: MEDIUM
   The company holds significant fixed assets in investment property but carries substantial long-term liabilities, primarily bank and director loans. Positive net assets exist but are minimal relative to liabilities, indicating moderate solvency risk. Current liabilities are low with positive net current assets, suggesting liquidity is manageable but limited.

2. Key Concerns:

• High Long-Term Debt: Total creditors after more than one year amount to £276,527 against net assets of only £2,377, indicating high leverage and reliance on external financing.
• Minimal Share Capital and Equity Buffer: Share capital is nominal (£1), and retained earnings are small, limiting the company's ability to absorb losses or fund growth internally.
• Single Director and Owner: The company is controlled and managed by one individual, which could pose governance and operational risks.

3. Positive Indicators:

• Stable Investment Property Asset Base: Fixed assets (investment properties) have maintained their fair value at £273,327 over the last three years, providing a tangible asset base.
• Current Assets Exceed Current Liabilities: Positive net current assets (£5,577) as of the latest accounts suggest the company can meet short-term obligations.
• Timely Filing and Compliance: Accounts and confirmation statement filings are up to date with no overdue filings, indicating regulatory compliance.

4. Due Diligence Notes:

• Assess the terms and repayment schedule of the bank loan and director’s loan to evaluate refinancing risk and cash flow impact.
• Review rental income and occupancy rates related to the investment property to verify income stability and valuation assumptions.
• Investigate any related party transactions, particularly loans or financial support from the director, to understand financial dependencies.
• Confirm no undisclosed contingent liabilities or litigation that could impact financial stability.
• Evaluate the company’s business plan and projections for growth or debt reduction, given the high leverage.