Company Number: 14671504

Analysis Date: 2025-07-29 19:24 UTC

1. Credit Opinion: CONDITIONAL APPROVAL. THE LEAF INDIA LTD is a newly incorporated micro-entity operating in the licensed restaurant sector with minimal financial history. The company shows a very modest net asset base (£913) and a working capital position where current assets (£7,757) slightly exceed current liabilities (£5,944), but there is a significant long-term creditor balance (£27,000) which exceeds net current assets and impacts overall net assets. The director is also the sole significant controller, indicating centralized management. Given the early stage of the company and limited financial buffer, credit should be extended cautiously and likely with conditions such as personal guarantees or collateral, plus regular financial monitoring.

2. Financial Strength: The balance sheet shows fixed assets of £26,100 primarily representing initial capital investment, and current assets of £7,757. Current liabilities are £5,944, resulting in positive net current assets of £1,813, which is a small cushion for short-term obligations. However, the company has £27,000 creditors due after one year, indicating longer-term obligations that reduce net assets to £913. Shareholders’ funds mirror this low net asset value, reflecting a very thin equity base. The financial position is fragile with minimal equity and moderate gearing relative to net assets, which may constrain the company’s ability to absorb shocks or invest in growth without additional capital.

3. Cash Flow Assessment: With limited current assets and a small positive working capital, liquidity appears tight but adequate to meet immediate liabilities. The company reports 4 average employees, indicating some operational activity that will consume cash resources. The absence of an audit and the micro-entity reporting exemption limits visibility on detailed cash flow statements, but the presence of long-term creditors suggests some external financing. The company should be monitored for timely payment of trade creditors and ability to maintain positive cash flow as it scales operations.

4. Monitoring Points:

• Track cash flow statements and working capital trends to ensure liquidity does not deteriorate.
• Monitor repayment or refinancing plans related to the £27,000 long-term creditors.
• Observe any increases in equity or capital injections from the shareholder to strengthen the balance sheet.
• Review operational performance regularly given dependence on one director and potential sector risks in licensed restaurants.
• Ensure timely filing of future accounts and confirmation statements to maintain transparency and compliance.