SAGAR IV SWEETS & TANDOORI LTD

Executive Summary

SAGAR IV SWEETS & TANDOORI LTD has demonstrated improving net asset position and reduced long-term liabilities over recent years, supporting creditworthiness at a micro-entity scale. However, working capital has tightened and the business remains small and young, warranting cautious credit extension with active monitoring of liquidity and operational performance. Conditional approval is recommended based on current financials and management stability.

SAGAR IV SWEETS & TANDOORI LTD - Analysis Report

Company Number: 13454545

Analysis Date: 2025-07-20 18:17 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   SAGAR IV SWEETS & TANDOORI LTD is a micro-entity operating in the licensed restaurant and takeaway sector, currently active and with no overdue filings. The company shows positive net assets and shareholder funds that have increased significantly over three years, indicating capital injection or retained earnings growth. However, the volatility in current assets and liabilities and a reduced average employee count suggest operational fluctuations. The company is relatively young (incorporated 2021) and modest in scale, which carries inherent risk. Approval is recommended with conditions, including regular monitoring of liquidity and trading performance.

2. Financial Strength:

• Net assets improved from £3,182 in 2021 to £54,950 in 2024, reflecting a strengthening equity base.
• Fixed assets increased modestly (£45k to £62.1k), showing some investment in long-term resources.
• Current assets declined from £31,917 in 2023 to £23,922 in 2024, while current liabilities fell significantly from £38,892 to £18,320, improving the net current asset position from £26,463 to £5,602.
• Long-term creditors dropped from £38,892 in 2023 to £12,752 in 2024, improving the overall solvency ratio.
• The balance sheet is healthy for a micro-entity, but the reduced net current assets in 2024 compared to 2023 indicates tighter working capital.

3. Cash Flow Assessment:

• The net current assets of £5,602 suggest the company maintains a positive but limited short-term liquidity buffer.
• The drop in current liabilities within one year is positive for near-term liquidity.
• The company employs only 2 staff on average, implying low fixed overheads which supports cash flow stability.
• No detailed cash flow statements are available, but the balance sheet trends imply cautious liquidity management is needed to avoid cash strain.

4. Monitoring Points:

• Track working capital fluctuations and ensure current liabilities remain manageable relative to current assets.
• Monitor profitability and cash generation closely given the small scale and limited employee base.
• Watch for any significant increases in creditors or asset impairments that may affect liquidity.
• Review director’s conduct and business operations regularly to confirm continued financial stewardship under sole control of Mr. Lakhwinder Sharma.
• Confirm timely filing of accounts and confirmation statements to avoid compliance risks.