RNK EXPRESS LTD

Executive Summary

RNK EXPRESS LTD presents a high-risk profile primarily due to severe liquidity constraints and negative working capital despite growth in fixed assets. While regulatory compliance is up to date and governance appears stable, the company’s minimal equity buffer and large short-term liabilities raise concerns about its ability to meet obligations without additional support. Further investigation into asset liquidity and cash flow dynamics is essential to fully assess operational sustainability.

RNK EXPRESS LTD - Analysis Report

Company Number: 12893439

Analysis Date: 2025-07-20 14:19 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns, reflected by a sharp increase in current liabilities vastly exceeding current assets, leading to negative net current assets of £162,784 at the 2024 year-end. Despite positive net assets due to fixed assets, the liquidity strain poses a material risk to meeting short-term obligations.

2. Key Concerns:

• Negative Working Capital: The current liabilities (£230,134) exceed current assets (£67,350) by a substantial margin, indicating potential cash flow difficulties and risk of default on short-term creditors.
• Rapid Increase in Fixed Assets Without Corresponding Liquidity: Fixed assets grew substantially from £4,443 in 2023 to £166,499 in 2024, but this has not translated into improved liquidity or net current asset position, raising questions about asset liquidity and financing methods.
• Minimal Net Assets and Equity Buffer: Net assets are extremely low (£3,715), providing little equity cushion against operational or market shocks.

3. Positive Indicators:

• Timely Compliance: The company is up to date with accounts and confirmation statement filings, indicating good regulatory compliance with no overdue filings or penalties.
• Stable Management Control: The sole director and major shareholder, Mr. Rajkumar Thusyanthan, maintains consistent and transparent control, potentially facilitating decisive governance.
• Small Workforce Stability: The average number of employees remained stable at 4, suggesting operational consistency without abrupt workforce changes.

4. Due Diligence Notes:

• Investigate the composition and liquidity of the fixed assets acquired in the latest year to assess if they can be leveraged or sold to improve liquidity.
• Review the company’s cash flow statements and creditor payment schedules to identify any delayed or missed payments and understand working capital management.
• Examine sources of financing for the asset increase—whether funded through debt or equity—and analyze repayment terms to gauge solvency risk.
• Assess customer base and revenue streams (not provided) to evaluate operational sustainability and the ability to generate cash flow to service liabilities.
• Confirm whether there have been any director-related transactions or guarantees that could affect financial risk.