SHERGILL ESTATES LIMITED

Executive Summary

Shergill Estates Limited is a newly incorporated company operating in real estate management and ownership with significant liquidity and solvency challenges as evidenced by negative net assets and a large working capital deficit. While regulatory filings are up to date and management is aligned with ownership, the financial position raises immediate concerns about the company’s ability to meet its short-term obligations and sustain operations without additional capital or restructuring. Further detailed due diligence is warranted to evaluate the viability of the business plan and asset realizability.

SHERGILL ESTATES LIMITED - Analysis Report

Company Number: 15089316

Analysis Date: 2025-07-29 21:15 UTC

1. Risk Rating: HIGH
   Shergill Estates Limited exhibits significant solvency and liquidity risks due to its negative net assets and substantial current liabilities exceeding current assets by a large margin within its first financial year.

2. Key Concerns:

• Negative Net Assets and Shareholders’ Funds: The company reports net assets of -£102,678, indicating liabilities exceed assets, a clear solvency concern early in its lifecycle.
• Severe Working Capital Deficit: Current liabilities (£623,919) far outweigh current assets (£7,306), resulting in a net current liability position of -£616,613, suggesting acute liquidity stress and potential inability to meet short-term obligations.
• Short Operational History with Limited Financial Data: Incorporated in August 2023 and reporting for just over one year, the company’s financial stability and operational sustainability remain unproven, increasing uncertainty.

3. Positive Indicators:

• Active Status with Full Compliance: The company is active, not in liquidation or administration, and has filed accounts and confirmation statements on time, indicating regulatory compliance and governance diligence.
• Ownership and Management Alignment: Both directors are also significant controllers, which may align management incentives with company success.
• Fixed Assets Base: There are fixed assets valued at £513,935, which could provide some collateral or operational foundation.

4. Due Diligence Notes:

• Investigate the composition and nature of current liabilities (€623,919) to understand whether these are supplier debts, loans, or other obligations and the terms for repayment.
• Clarify the valuation and liquidity of fixed assets (£513,935) to assess their potential to cover liabilities or be monetized if needed.
• Review cash flow projections and business plans to ascertain how the company intends to address its negative working capital and equity position.
• Confirm if there are any contingent liabilities or off-balance-sheet obligations not reflected in the accounts.
• Evaluate credit terms and relationships with creditors, particularly given the liquidity strain.
• Assess the directors’ experience and track record in managing real estate businesses under financial stress.