Press Release
VIS Assigns Initial Broker Management Rating to Sherman Securities (Private) Limited
Karachi, June 19, 2025: VIS Credit Rating Company Ltd. (VIS) has assigned initial Broker Management Rating of ‘BMR2’ to Sherman Securities (Private) Limited. Outlook on the assigned rating is ‘Stable’.
The rating signifies strong external control framework, HR & Infrastructure, sound Supervisory Framework, Internal control framework, Client Relationship & Fairplay, as well as Compliance and Risk Management. Regulatory Requirements and Financial Management are considered adequate.
SSPL was incorporated in 2002. The principal activities of the Company are investments, brokerage services, interbank brokerage services, Initial Public Offer (IPO) underwriting, and portfolio management. Majority shareholding is vested with Mr. Muhammad Samin Younus. The Company operates through its head office which is based in Karachi. SSPL is registered with Securities & Exchange Commission of Pakistan (SECP) and holds Trading Rights Entitlement Certificate (TREC) for Trading and Self Clearing (TSC) granted by Pakistan Stock Exchange Limited (PSX). External auditors of the Company belong to Category ‘A’ of State Bank of Pakistan’s panel of auditors.
Assigned rating takes into account the Company’s governance framework, with board of directors of 4 members, with one independent director. Inclusion of certified and independent directors may further enhance the Company’s governance framework and avoid overlapping of members across board committees. While internal policies and procedures are in place, enhancement in the scope of the same may be considered for further improvement in the internal control framework of the Company. External control framework of the Company is supported by strong disclosure levels. The rating also factors in sound management and client services, with various facilitation tools to streamline processes. Enhancing the visibility of the customer grievance tool on the website as well as further enhancement in client services procedures may be considered. Rating also takes note of the non-compliances highlighted by PSX and the penalty imposed thereon. However, the client has filed an appeal against the order. Going forward, ensuring compliance with all applicable regulations will be important from the rating’s perspective.
Company’s financial profile is characterized by a significant rebound in the Company’s profitability in FY24 and 9MFY25, driven by sound realized and unrealized gains, along with higher brokerage income resulting from surge in industry volumes, supported by favorable market dynamics and improved macroeconomic indicators. Resultantly, operational efficiency of the Company witnessed improvement. Liquidity profile of the Company is considered sound while market risk is elevated. Capitalization profile of the Company benefits from a conservative capital structure. Additionally, the Company’s equity base has witnessed a sizeable increase in line with higher profitability. Going forward, diversifying revenue base, continued enhancement in the profitability profile as well as maintaining liquidity and capitalization profile will be important for the rating.
For further information on this rating, please contact 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria: Broker Management Ratings:
https://docs.vis.com.pk/Methodologies%202024/Broker-Management.pdf
VIS Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf