Press Release

VIS Assigns Initial Entity Ratings to Growth Securities (Private) Limited

Karachi, May 19, 2020: VIS Credit Rating Company Ltd. (VIS) has assigned initial entity ratings of ‘A-/A-2’ (Single A Minus/A-Two) to Growth Securities (Private) Limited (GSPL). The long term rating of ‘A-’ signifies good credit quality with adequate protection factors. Risk may vary slightly from time to time because of economic conditions. Short term rating of ‘A-2’ depicts good certainty of timely payment where liquidity factors are sound and good access to capital markets. Outlook on the assigned ratings is ‘Stable’.

GSPL is engaged in provision of equity brokerage services to clients. The assigned ratings incorporate company’s moderately leveraged capital structure, satisfactory operating profitability and adequate liquidity indicators. However, ratings are constrained by governance and internal control framework of the company which may be improved through inclusion of additional directors and increased oversight. The assigned ratings also take into account company’s exposure to market risk due to its proprietary book. Diversification in revenue sources can be undertaken to lower risk of volatility in earnings. In view of the same, GSPL plans to grow its institutional brokerage business and initiate corporate advisory during the ongoing year. Disruption in operations due to coronavirus outbreak and impact of the same on market volumes remains a business risk factor.

The ratings are dependent on maintenance of rating benchmarks, low leverage indicators, retention of key personnel, sustainability of operating profitability and successful execution of envisaged business plan. Meanwhile, strengthening of internal controls and diligent monitoring of risks is also important from ratings perspective.


For further information on this rating announcement, please contact the undersigned (Ext: 306) or Mr. Muhammad Ibad Desmukh (Ext: 205) at 021-35311861-71 or email at info@vis.com.pk.



Faryal Ahmad Faheem
Deputy CEO

Applicable rating criteria: Methodology - Securities Firms Rating (June 2017)
http://vis.com.pk/kc-meth.aspx

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright May 19, 2020 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.