SR SREE PRIVATE LIMITED

Executive Summary

SR SREE PRIVATE LIMITED is currently in a precarious financial condition, characterized by negative working capital, minimal cash reserves, and negative equity, indicating sustained losses and liquidity challenges. Immediate action is required to inject capital, improve cash flow, and review operational viability to avert insolvency and restore financial health. With prompt and effective measures, the company has a chance to stabilize and improve its financial outlook.

SR SREE PRIVATE LIMITED - Analysis Report

Company Number: 13527292

Analysis Date: 2025-07-20 18:45 UTC

Financial Health Assessment of SR SREE PRIVATE LIMITED

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1. Financial Health Score: D

Explanation:
The company exhibits clear symptoms of financial distress, with persistent negative net current assets and shareholders' funds over multiple years. The minimal cash holdings and ongoing liabilities suggest a weak liquidity position, limiting operational flexibility. While not yet insolvent, the financial indicators signal a concerning condition requiring prompt intervention.

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2. Key Vital Signs

Metric	Latest (2024) Value	Interpretation
Cash at Bank	£5	Critically low cash reserves, indicating poor liquidity.
Current Liabilities	£8,617	Fixed level of short-term obligations to settle soon.
Net Current Assets	-£8,612	Negative working capital, a symptom of liquidity stress.
Shareholders’ Funds (Equity)	-£8,614	Negative equity, indicating accumulated losses and insolvency risk.
Trend (2021-2024)	Declining	Continuous deterioration in net assets and equity.

• Liquidity (Cash & Net Current Assets): The company’s "pulse" is weak — cash has dwindled from £5,727 in 2021 to just £5 in 2024, while liabilities remain constant, raising alarm for the ability to cover immediate debts.

• Solvency (Shareholders’ Funds): The company’s “heart” is struggling, reflected by persistent negative equity, which suggests the business has been consuming capital without generating sufficient returns.

• Operational Activity: Lack of employees and negligible current assets other than cash imply minimal operational activity or growth investments.

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3. Diagnosis

SR SREE PRIVATE LIMITED shows classic "symptoms of financial distress":

• Liquidity Crisis: The company holds almost no cash to meet its current liabilities, indicating a "poor blood flow" of funds. This is a red flag for potential payment defaults.

• Negative Working Capital: Negative net current assets over several years reveal that short-term debts exceed short-term assets, a symptom of operational inefficiency or insufficient funding.

• Negative Equity: Continuous accumulation of losses has eroded shareholders’ equity, suggesting the company is "clinically insolvent" on a balance sheet basis.

• Stagnant Creditors: Creditors remain constant at £8,617, which might mean the company is either not growing or is unable to pay down debts.

• Minimal Operational Scale: No employees and minimal current assets suggest the company may not be actively trading or is in the early/startup phase without revenue generation.

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4. Recommendations

To restore financial wellness and improve the company’s prognosis, consider the following:

a. Immediate Cash Flow Management

• Inject working capital or secure short-term financing to "resuscitate" liquidity.
• Prioritize payments to critical creditors to avoid legal or operational disruptions.

b. Operational Review

• Assess business model viability given the minimal operational presence and explore revenue-generating activities urgently.
• Consider cost restructuring if any recurring expenses are draining resources.

c. Strategic Capital Infusion

• Engage shareholders or external investors for equity funding to rebuild the balance sheet and restore positive net assets.
• Explore grants or loans suitable for companies in the IT and education sectors (aligned with SIC codes).

d. Financial Monitoring and Controls

• Implement rigorous cash flow forecasting and management to prevent future liquidity crises.
• Regularly review creditor terms and negotiate extensions where possible.

e. Professional Advisory

• Seek advice from insolvency practitioners or financial advisors to explore restructuring options if turnaround seems challenging.
• Evaluate any contingent liabilities or tax obligations thoroughly.

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Prognosis

Without intervention, the company risks further deterioration leading to insolvency or forced liquidation. However, with timely capital injection and operational restructuring, it may stabilize and gradually restore financial health. The outlook depends heavily on management’s ability to correct the liquidity shortfall and implement sustainable revenue streams.

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