NIRMALA LTD

Executive Summary

NIRMALA LTD is a newly established micro-entity showing a weak financial position with negative net assets and working capital deficiency. The company currently lacks the financial strength and liquidity to comfortably service credit obligations. Credit facilities should be declined until meaningful improvement in financial health and cash flows is demonstrated.

NIRMALA LTD - Analysis Report

Company Number: 14458225

Analysis Date: 2025-07-20 12:03 UTC

1. Credit Opinion: DECLINE
   NIRMALA LTD displays a negative net asset position of £4,553 despite being a micro-entity with minimal turnover and employees. The company’s liabilities exceed its current assets, indicating a working capital deficiency and balance sheet weakness. Given the company was incorporated recently (November 2022) and the latest accounts show a net liability position, it poses a high risk in terms of repayment capability and financial stability. The absence of profit figures and cash flow data further limits confidence in its ability to service debt or meet commercial obligations. Without evidence of improving financials or external support, extending credit is not advisable at this stage.

2. Financial Strength:
   The balance sheet reveals current assets of £3,962 against current liabilities of £8,515, resulting in negative net current assets of £4,553. Total net assets are also negative by the same amount, indicating the company is technically insolvent on a going concern basis. Shareholders’ funds are negative, which reflects accumulated losses or capital deficiencies. The micro-entity status and minimal employee count (2) suggest limited scale and operational capacity. The company’s financial position is fragile with no buffer for economic downturns or unexpected expenses.

3. Cash Flow Assessment:
   No explicit cash flow statement is provided, but the negative net current assets imply potential liquidity stress. Current liabilities exceed current assets by more than double, indicating short-term obligations may not be met comfortably from available liquid resources. This exposes the company to risk of default on payables and creditor pressure. The small asset base and lack of fixed assets also suggest limited collateral value or ability to raise funds quickly.

4. Monitoring Points:

• Track improvements in net current assets and overall net asset position in future filings.
• Monitor profitability indicators and cash generation capacity once trading history extends.
• Watch for any director or shareholder capital injections or external funding to strengthen liquidity.
• Review payment patterns to suppliers and any overdue liabilities to assess operational resilience.
• Confirm timely filing of accounts and confirmation statements to avoid regulatory penalties.