NAZTEX ABAYAS LTD

Executive Summary

NAZTEX ABAYAS LTD is a newly incorporated micro-entity showing early signs of financial stress with negative net assets and working capital deficiency. While regulatory compliance is maintained, the company’s solvency and liquidity position raise significant concerns. Further due diligence is essential to evaluate business viability and financial support mechanisms before considering investment.

NAZTEX ABAYAS LTD - Analysis Report

Company Number: 14809477

Analysis Date: 2025-07-29 20:42 UTC

1. Risk Rating: HIGH
   Justification: The company, NAZTEX ABAYAS LTD, exhibits a negative net asset position (£-667) at its first financial year-end, indicating insolvency on a balance sheet basis. It is a very new entity (incorporated April 2023) and operates as a micro-entity with minimal financial history. The negative working capital (current assets £2,850 vs current liabilities £3,517) suggests liquidity stress. No audit is performed, and the company relies on micro-entity filing exemptions, limiting transparency.

2. Key Concerns:

• Negative net assets and net current liabilities indicate potential solvency and liquidity risks.
• Limited operating history (only one financial year) and no profit & loss account filed restrict assessment of operational sustainability.
• Single director and majority owner concentration (75-100% control by Mr Nazir Ahmed) increases governance and control risk.

3. Positive Indicators:

• The company is compliant with filing deadlines for accounts and confirmation statements, suggesting regulatory adherence so far.
• The business operates in retail and wholesale textile sectors, which can be sustainable if properly managed.
• Low employee count (2 including director) implies limited overhead, potentially easing cash flow pressures.

4. Due Diligence Notes:

• Obtain updated management accounts and cash flow forecasts to assess current liquidity and going concern status.
• Investigate the reasons behind the negative net assets and whether there is any financial support from the director or related parties.
• Review business model viability, customer base, and supplier relationships given the micro-entity scale and early stage of operations.
• Confirm no undisclosed liabilities or contingent risks exist.
• Assess director’s background and track record in managing similar businesses.