Press Release

VIS Reaffirms Broker Fiduciary Rating of Adam Securities Limited

Karachi, December 28, 2023: VIS Credit Rating Company Ltd. (VIS) has reaffirmed Broker Fiduciary Rating of Adam Securities Limited (ASL) at ‘BFR3++’. Rating of BFR3++ denotes good fiduciary standards. Outlook on the assigned rating is ‘Stable’. Last rating action was announced on November 7, 2022.
The rating signifies sound internal controls and management and client services while business financial sustainability along with ownership and governance are also considered sound.
Adam Securities (ASL) was incorporated in 2001 as a private limited company and subsequently became a public unlisted company in 2016. ASL is principally engaged in provision of equity brokerage services to domestic retail and institutional clients. Major shareholding of the company is vested with Mr. Noman Abdul Majeed who serves as a director of the Company. ASL is a Trading Right Entitlement Certificate (TREC) holder of Pakistan Stock Exchange. The company is also a Member of Pakistan Mercantile Exchange Limited (PMEX). External auditors are M/s Baker Tilly Mehmood Idrees Qamar Chartered Accountants. Auditors belong to category ‘A’ on the approved list of auditors published by the State Bank of Pakistan (SBP). ASL operates through its head office based in Karachi.
Assigned rating takes note of the Company’s sound ownership, internal controls and governance levels. At present, the Company has two board level committees chaired by independent directors with board meetings held more frequently. External disclosure levels are also considered sound. Rating also takes note of the Company’s management and client service, also availability of trading resources on website and social media platforms has been noted positively, however, availability of equity research reports on the Company’s website may be considered for better client reach. Overall regulatory compliance levels and control framework is considered sound, increase in the frequency of review and documentation of internal control system and compliance procedures has been noted. Measures to ensure client confidentiality are well in place.
Assessment of financial profile of the Company indicates deterioration in the Company’s operational earnings due to decline in core brokerage income as a result of subdued market activity during the year. Operational efficiency of the Company was also impacted, despite consistent decline on timeline basis, cost-to-income ratio remains on the higher side. Liquidity profile of the Company remains sound with liquid assets providing more than ample coverage to total liabilities during FY23. Market risk of the Company remains manageable given high proportion of T-bill and mutual fund investments in the portfolio. Though quantum of short term investments in relation to equity has declined, it still remains high. The Company’s capitalization indicators also improved during the year owing to decline in short term borrowings. Going forward, maintenance of low market risk, gearing and leverage, low cost to income ratio and further improvement in diversification of revenue stream will remain important.
For further information on this rating announcement, please contact Ms. Syeda Batool Zehra Zaidi (Ext: 216) or the undersigned (Ext: 207) at (021) 35311861-64 or email at

Syed Asif Ali
Executive Director

Applicable Rating Criteria: Broker Fiduciary Ratings:

VIS Rating Scale

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