RATHMA HOLDINGS LIMITED

Executive Summary

Rathma Holdings Limited shows signs of financial recovery with positive net assets in 2023 after earlier deficits, but its ongoing working capital deficit and high leverage present liquidity concerns. Approval is possible if conditions ensure close cash flow monitoring and support for short-term obligations. The company’s reliance on investment property and minimal operational scale require careful oversight of asset values and debt servicing capacity.

RATHMA HOLDINGS LIMITED - Analysis Report

Company Number: 13084328

Analysis Date: 2025-07-20 11:54 UTC

1. Credit Opinion:
   CONDITIONAL APPROVAL. Rathma Holdings Limited operates in real estate investment/letting with a small equity base and significant long-term debt. The company has shown improvement in net assets, turning positive in 2023 after losses in prior years, indicating some recovery. However, the persistent negative working capital position and current liabilities exceeding current assets raise concerns about short-term liquidity and ability to meet immediate obligations. Credit approval should be conditional on enhanced liquidity monitoring and possibly securing additional working capital or guarantees.

2. Financial Strength:

• The company holds investment property valued at approximately £107k, representing its main asset.
• Shareholders’ funds improved from a deficit of £4,198 in 2022 to a modest positive of £1,346 in 2023, showing a turnaround in retained earnings.
• Total liabilities remain substantial, with £69k bank loans payable after one year and £47k current liabilities, reflecting significant gearing and leverage.
• The company’s net assets remain low relative to liabilities, indicating limited buffer against losses or adverse market conditions.

3. Cash Flow Assessment:

• Cash at bank increased slightly to £10.4k in 2023 but remains low relative to current liabilities of £47k, resulting in a net current liability position of -£36.7k.
• The working capital deficit suggests potential cash flow strain. The company’s ability to service short-term debts and ongoing expenses may be dependent on refinancing or additional capital injections.
• No employees are reported, indicating minimal operating expenses, but also limiting revenue-generating capacity beyond property income.
• The lack of detailed profit/loss data restricts full cash flow analysis, but the balance sheet signals liquidity risk.

4. Monitoring Points:

• Monitor cash reserves and liquidity closely, ensuring current liabilities can be met as they fall due.
• Track debt servicing on bank loans and any renegotiations or refinancing outcomes.
• Watch for changes in investment property valuation or realizations that could affect asset base.
• Review any additional capital contributions from the controlling shareholder to support working capital.
• Assess any filing delays or changes in director control as indicators of operational stability.