⚠ Acquisition Risk: HIGH — RKV Gold Trade has posted net losses every year on record (3 consecutive years, AED 266K cumulative deficit). Revenue declined 25% in 2024 and gross margins compressed to 1.76%. The business survives solely on owner capital injections. 2025 financials are outstanding and must be received before any valuation discussion.
2024 Revenue
897K
▼ 25.3% vs 2023
2024 Gross Margin
1.76%
▼ from 4.12% in 2023
2024 Net Loss
(79K)
3rd consecutive loss year
Accum. Deficit
(266K)
88% of share capital eroded
Cash (Dec 2024)
62K
Owner-injected AED 78K in 2024
Revenue vs. Cost of Revenue
AED — Annual. Gross profit is razor-thin; any cost increase flips to negative.
Net Profit / Loss Trend
AED — 3 consecutive loss years; losses are worsening.
Revenue by Channel (2024)
Amazon channel dropped entirely vs. 2023 (was AED 58K).
Gross Margin Trend
Margin compression year over year — no path to profitability visible.
Company Snapshot
Legal Name
R K V Gold Trade L.L.C
Dubai, UAE · LLC
Sole Shareholder
Rjeev Kumar Verma Ram Dularay Verma
Indian national · 100% ownership
Share Capital
AED 300K
3,000 shares × AED 100 · Fully paid
Primary Bank
Bank of Baroda (BOB)
Single banking relationship
Sales Channels
Direct · Noon · Amazon*
*Amazon dropped in 2024
Total Equity (Dec 2024)
AED 88K
Dominated by share capital; negative earnings
Statement of Comprehensive Income
Revenue 2023
1,202,102
AED
Revenue 2024
897,592
▼ AED 304,510 (-25.3%)
Gross Profit 2023
49,501
GPM: 4.12%
Gross Profit 2024
15,830
GPM: 1.76% ▼
| Income Statement | 2024 (AED) | 2023 (AED) |
|---|
| Revenue |
| Direct Sales | 846,941 | 1,089,218 |
| Noon | 50,651 | 54,559 |
| Amazon | — | 58,324 |
| Total Revenue | 897,592 | 1,202,102 |
| Cost of Revenue |
| Opening Inventory | 51,628 | — |
| Purchases | 832,032 | 1,197,853 |
| Less: Closing Inventory | (2,012) | (51,628) |
| Packing Materials | 115 | 92 |
| Online Charges | — | 6,283 |
| Total COGS | (881,762) | (1,152,600) |
| Gross Profit | 15,830 | 49,501 |
| G&A Expenses |
| Rent — Accommodation | 54,250 | 31,260 |
| Rent — Office | 3,400 | 43,440 |
| DEWA | 12,706 | 6,042 |
| Telephone | 2,289 | 2,556 |
| License & Government | 13,530 | 12,931 |
| Travel & Conveyance | 5,982 | 3,766 |
| Courier | 1,313 | 198 |
| Online Charges | — | 3,674 |
| Tax Consultation | 1,660 | 1,953 |
| Other | 10 | 819 |
| Total G&A | (95,139) | (106,639) |
| Net Loss | (79,310) | (57,138) |
Revenue Channel Mix — 2023 vs 2024
Amazon disappeared entirely. Noon shrinking. Concentration risk on direct sales.
G&A Expense Breakdown (2024)
Accommodation rent is the largest G&A item — may include personal living costs.
Key Ratios
Gross Margin
1.76%
2023: 4.12% · Trending down
Net Margin
-8.83%
2023: -4.75%
OpEx / Revenue
10.6%
2023: 8.9% — overhead rising vs revenue
G&A Coverage
0.17×
Gross profit covers only 17% of G&A (2024)
Statement of Financial Position
Total Assets 2024
88,118
AED · Mostly cash + equity
Cash (Dec 2024)
62,087
+AED 47,837 YoY (owner-funded)
Total Liabilities
—
Zero liabilities both years
Retained Deficit
(266,246)
88% of share capital eroded
| Balance Sheet | Dec 2024 (AED) | Dec 2023 (AED) |
|---|
| Non-Current Assets |
| Property & Equipment — Net | 21,893 | 21,268 |
| Total Non-Current Assets | 21,893 | 21,268 |
| Current Assets |
| Inventory | 2,012 | 51,628 |
| Accounts Receivable | — | — |
| Deposits | 2,126 | 2,126 |
| Cash & Cash Equivalents | 62,087 | 14,250 |
| Total Current Assets | 66,225 | 68,003 |
| TOTAL ASSETS | 88,118 | 89,271 |
| Equity |
| Share Capital | 300,000 | 300,000 |
| Shareholders Current Account | 54,364 | (23,793) |
| Retained Earnings | (266,246) | (186,936) |
| Total Equity | 88,118 | 89,271 |
| Liabilities |
| Accounts Payable | — | — |
| Other Payables | — | — |
| Total Liabilities | — | — |
| TOTAL EQUITY & LIABILITIES | 88,118 | 89,271 |
Asset Composition (Dec 2024)
Cash dominates total assets — mostly owner-injected funds, not earnings.
Equity Waterfall
Share capital being consumed by accumulated losses.
Fixed Assets Breakdown
| Asset Category | Dec 2024 (AED) | Dec 2023 (AED) | Note |
|---|
| Computers & Accessories | 1,135 | 510 | +AED 625 addition in 2024 |
| Camera Fittings | 10,800 | 10,800 | No change |
| Furniture & Fittings | 9,330 | 9,330 | No change |
| Phone | 628 | 628 | No change |
| Net Book Value | 21,893 | 21,268 | ⚠ Zero depreciation charged — accounting anomaly |
🚩 Due Diligence Red Flags
Flags are rated Critical / High / Medium based on deal-blocking potential and financial risk.
🔴 Three Consecutive Loss Years — Accumulated Deficit AED 266K
The company has never been profitable on record: FY2022 loss AED 129,799 · FY2023 loss AED 57,138 · FY2024 loss AED 79,310.
Total accumulated deficit of AED 266,246 represents 88.7% of the AED 300,000 share capital. The business is technically operating on contributed capital, not earned equity.
Ask: What will change operationally to generate profits? What is the growth plan for 2025?
🔴 Gross Margin Near Zero — 1.76% in 2024
Gold trading inherently has thin margins, but at 1.76% gross margin the business cannot sustain even minimal operational overhead (AED 95K G&A against only AED 15,830 gross profit).
Any price increase of 2% in gold procurement would make the gross margin negative. This is structurally unviable without significantly higher revenue volume.
Ask: What is the sourcing/pricing model? Are there supplier agreements that lock in margins? What was the margin in early 2025?
🔴 Revenue Declined 25.3% YoY — Amazon Channel Dropped Entirely
Revenue fell from AED 1,202,102 (2023) to AED 897,592 (2024). The Amazon channel (AED 58,324 in 2023) went to zero in 2024 with no explanation in the financial statements.
This could indicate account suspension, a compliance issue, or voluntary exit — all of which have different implications for acquisition risk.
Ask: What happened to the Amazon account? Was it suspended? What is the current status?
🔴 Business Survival Dependent on Owner Capital Injections
The company has never generated positive operating cash flow. It has survived through the Shareholders Current Account:
AED 129,799 injected in 2023 · AED 78,157 injected in 2024 (total AED 207,956 in just 2 years).
Without continued owner funding, the company would have been insolvent. This is not a self-sustaining business.
Ask: What is the owner's intent post-acquisition? Is there a transition plan?
🟡 Accommodation Expense Charged to Business (AED 54,250 in 2024)
The largest single G&A line item is "Rent — Accommodation" at AED 54,250 (2024), up from AED 31,260 (2023). This appears to be the owner's personal housing charged through the business.
This is a common practice in sole-owner UAE LLCs but inflates reported opex and disguises the true operational cost structure. Normalized G&A (ex-accommodation) would be ~AED 40,889.
Ask: Is this accommodation used for business purposes? Will this continue post-acquisition?
🟡 Zero Depreciation Charged — Accounting Anomaly
The company holds AED 21,893 in fixed assets (computers, cameras, furniture, phones) but has never charged any depreciation across all periods on record.
This overstates asset values and understates reported losses. Under IFRS (applicable in UAE), these assets should be depreciated over their useful lives. The accounting treatment is non-compliant.
Ask: Why has no depreciation been charged? Is the accountant using a different basis? Are accounts audited?
🟡 No Audited Financial Statements — Compiled/Management Accounts Only
Both years of financial statements are signed by the owner (R.K. Verma) with a company stamp — there is no independent auditor's report. These are management-prepared accounts, not audited financials.
This means figures are unverified and the risk of material misstatement is higher. UAE LLCs are required to maintain proper accounting records; audit requirement depends on company size.
Ask: Are audited accounts available? Who prepared these statements? What accounting software is used?
🟡 Inventory Near-Zero at Dec 2024 (AED 2,012 vs AED 51,628 in 2023)
Inventory declined 96% year over year. In a gold trading business, very low inventory could indicate the business is winding down, facing cash flow constraints preventing restocking, or shifting to a just-in-time model.
Combined with the revenue decline, this raises questions about operational continuity heading into 2025.
Ask: What is current inventory level? What is the restocking model? Is the business still actively trading in 2025?
🟡 No VAT Disclosure in Financial Statements
UAE VAT (5%) was introduced in 2018 and applies to most goods. Gold has a special "designated zone" and VAT treatment in the UAE, but there is no VAT receivable, payable, or disclosure anywhere in these statements.
If the business is VAT-registered and not disclosing this, there may be compliance risk. If not registered, this requires verification against the VAT registration threshold (AED 375K — which this business exceeds).
Ask: What is the VAT registration status? Are VAT returns filed? Any outstanding FTA liabilities?
🔵 Single Bank Relationship — Bank of Baroda Only
All cash is held at a single bank (Bank of Baroda). While not a red flag on its own, it limits financial flexibility and means all transaction history is concentrated. Bank statements from BOB should be requested and reconciled against reported cash balances.
🔵 goldtrade.ae Domain Ownership Not Verified
The domain goldtrade.ae (the basis of this deal) is not mentioned in the financial statements. Domain ownership, website traffic, and any associated digital assets need to be verified as part of the company or as a separate transferable asset.
🔵 2025 Financials Outstanding — Gap Year Unknown
We have data through Dec 2024 only. Given the deteriorating trend (revenue -25%, margin -57%), 2025 performance is critical for valuation. The business requested these but they are not yet received. No deal should be priced without seeing 2025 numbers.
Due Diligence Document Checklist
Tracks documentation status for the RKV Gold Trade LLC acquisition review.
| Document | Status | Notes |
|---|
| Financial Statements 2023 |
Received |
Compiled/management accounts, signed by owner. Not audited. |
| Financial Statements 2024 |
Received |
Compiled/management accounts, signed by owner. Not audited. |
| Financial Statements 2025 |
Requested |
⚠ Critical — must receive before valuation. Requested by LTV. |
| Audited Accounts (any year) |
Not Received |
No auditor report found in any filing. Request confirmation of audit status. |
| Trade License (current) |
Not Received |
Required to verify legal trading status, activity code, expiry date. |
| Memorandum of Association (MOA) |
Not Received |
Verify shareholding structure, share transfer restrictions, purpose clause. |
| Shareholder ID (Passport / EID) |
Not Received |
KYC for Mr. Rjeev Kumar Verma. Indian national — visa status required. |
| Bank Statements — BOB (12 months) |
Not Received |
⚠ Critical — reconcile against reported cash. Verify owner injection amounts. |
| VAT Registration Certificate |
Not Received |
Verify FTA registration status. Revenue exceeds AED 375K threshold. |
| VAT Returns (2023–2024) |
Not Received |
Cross-check declared revenue against FTA filings. |
| Amazon Seller Account Status |
Not Received |
⚠ Channel dropped entirely in 2024. Explain why — suspension? Voluntary? |
| Noon Seller Account Details |
Not Received |
Confirm account ownership, transferability on acquisition. |
| goldtrade.ae Domain Ownership |
Not Received |
⚠ Core asset — verify registrant, registrar, expiry, transferability. |
| Supplier Agreements / Contracts |
Not Received |
Who are the gold suppliers? Any exclusivity or favorable terms? |
| Customer List / Key Accounts |
Not Received |
Understand repeat customer base and concentration risk. |
| NDA |
Signed |
Goldtrade AE NDA executed. File in ~/Downloads. |
| Lease Agreements (Office / Storage) |
Not Received |
Verify tenancy continuity. Office rent dropped from AED 43K → AED 3.4K in 2024 — location change? |
| Employee List / Payroll |
Not Received |
No salary payable shown — is business operated solely by owner? Confirm headcount. |
| Corporate Tax Registration (CT) |
Not Received |
UAE CT effective Jun 2023 at 9%. Verify registration status and any filings. |
| Legal / Litigation Clearance |
Not Received |
Confirm no pending cases, Dubai Courts search recommended. |
Priority Questions for Seller
Must Answer Before Progressing
- What happened to the Amazon account in 2024?
- What are the 2025 YTD revenue and margin figures?
- Is the business still actively trading today?
- Are audited accounts available for any year?
- What is the VAT registration and FTA compliance status?
- What is the asking price and basis for valuation?
Due Diligence — Next Steps
- Request 12-month BOB bank statements
- Obtain Trade License and MOA
- Verify goldtrade.ae domain registrant (ae domain WHOIS)
- Confirm Amazon/Noon account transferability
- Confirm UAE Corporate Tax registration and status
- Request 2025 financials (Q1 at minimum)