RAKAM TRADING LIMITED

Executive Summary

RAKAM TRADING LIMITED is an early-stage small private company with modest positive equity but limited liquidity and operational scale. While regulatory compliance is satisfactory and there is no indication of governance concerns, the company’s low cash reserves and reliance on debtor collections present moderate risk to its solvency and operational stability. Further due diligence on cash flows and debtor quality is recommended to better understand its financial resilience.

RAKAM TRADING LIMITED - Analysis Report

Company Number: 14157976

Analysis Date: 2025-07-29 17:41 UTC

1. Risk Rating: MEDIUM
   RAKAM TRADING LIMITED is a recently incorporated small private company showing modest net current assets and positive shareholders’ funds. However, limited financial history, low cash reserves, and small scale of operations create moderate risk regarding its ability to meet obligations and sustain operations without additional capital or cash flow improvements.

2. Key Concerns:

• Liquidity Position: Cash at bank is only £1,148 against current liabilities of £11,528, indicating a tight liquidity position and potential cash flow stress. Reliance on debtors (£11,125) to cover liabilities may pose timing risk if collections are delayed.
• Limited Operational Scale: The company employs just one person and operates under the "small companies regime" with minimal turnover data publicly available, which limits visibility on revenue generation and operational sustainability.
• Short Operating History: Incorporated in June 2022 with first accounts to June 2023, the company has a short trading history. This restricts trend analysis for financial stability and growth prospects.

3. Positive Indicators:

• Positive Net Current Assets and Equity: Net current assets stand at £745, and shareholders’ funds equal this amount, indicating positive working capital and equity despite early-stage operations.
• No Overdue Filings or Compliance Issues: Both accounts and confirmation statement filings are up to date with no overdue status, reflecting good regulatory compliance.
• Director’s Going Concern Assertion: The director has confirmed a reasonable expectation to continue as a going concern, suggesting management confidence in ongoing operations.

4. Due Diligence Notes:

• Assess Debtor Quality and Collection Periods: Investigate the nature and collectability of the £11,125 debtors to understand if these amounts are recoverable within normal trading cycles.
• Review Cash Flow Projections: Obtain management’s cash flow forecasts to evaluate how the company plans to address the low cash reserves and meet short-term liabilities.
• Understand Revenue Streams and Customer Base: Since turnover data is not provided, inquire about contracts, client concentration, and revenue visibility to assess operational sustainability.
• Director and Ownership Structure: Mrs. Nilesha Patel holds between 25-50% shares and voting rights with control over director appointments. Verify any related party transactions or governance matters.
• Examine Tax and Social Security Liabilities: The current liabilities include £5,375 for taxation and social security; confirm these are current and manageable without risking penalties.