Tuesday, November 29

PACRA Assigns Initial Broker Management Rating to Abbasi and Company (Private) Limited

Lahore, September 22, 2021 (PPI-OT): Abbasi and Company (Pvt.) Limited (“ACPL” or “The Company”) is one of the pioneer of the brokerage industry in the north region. The Broker Manager Rating of ACPL reflects strong internal control framework, satisfactory risk management and compliance with regulatory affairs. The rating incorporates the strong business acumen of Mr. Muhammad Ismail Abbasi who is associated with the financial industry for more than ~35 years. The Company has established rigorous protocols regarding risk assessment by implementing KYC, CDD, AML, CFT and whistle blowing policies. However, the rating is constrained by governance framework of the Company which needs improvement.

The assigned also rating takes into account ACPL’s well developed organizational structure with qualified and experienced management team. The rating takes comfort from leverage free capital structure. The Company has devised comprehensive Disaster Recovery plan well-developed transactions execution and monitoring system, acclaimed research and strong control environment. The database modules are fully integrated and clients are provided with a complete range of services. ACPL’s Internal audit department is outsourced to an audit firm which further strengthens the control environment. ACPL has developed comprehensive policies to manage liquidity, market and other operational risks.

The average market share of ACPL stands at ~2%.; however, the brokerage income which increased YoY basis lacks diversification, resulting in rating constraints. The Company is also running a proprietary book hence, exposed to market risk. The bottom-line of the Company also improved to ~PKR 15mln during 9MFY21 (SPLY: loss ~PKR -13mln). The Company has an equity base of ~PKR 439mln at end-Mar’21. Strengthen market share, sustainable profits, sound internal controls, client relationship, HR and IT services and risk management framework, regulatory compliance, external control environment will remain imperative. Further, rational diversification of business activity may provide support to the company’s overall financial risk profile.

For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com