Press Release

VIS Upgrades Broker Fiduciary Rating of MRA Securities Limited

Karachi, May 13, 2024: VIS Credit Rating Company Ltd. (VIS) has upgraded Broker Fiduciary Rating of MRA Securities Limited to ‘BFR3++’ from BFR3+. Outlook on the assigned rating has also been revised to ‘Stable’ from Negative Last rating action was announced on November 14, 2022.

The rating signifies adequate governance, sound financial sustainability, client services and sound internal controls.
Muhammad Rafiq Adam (MRA) Securities Limited is principally engaged in provision of equity brokerage services to domestic clients. Majority shareholding in MRA is vested with the Rafiq family. Currently, the brokerage operates through its head office based in Karachi and 10 branches in the same city. Operations at branch level are limited to brokerage services only. The Company holds a Trading and Self Clearing (TSC) entitlement certificate issued by the Pakistan Stock Exchange Limited. The company has recently appointed Rahman Sarfaraz Rahim Iqbal Rafiq Chartered Accountants as their external auditors who belong to category ‘A’ on State Bank of Pakistan’s (SBP) approved list.

Assigned rating takes note of Company’s client servicing and management procedures, which continue to remain sound for the year. Internal control framework and regulatory compliance procedures also considered sound, however; scope of internal policies may be further enhanced. While disclosure levels of the Company continue to remain sound, overall ownership and governance framework is adequate, room for improvement exists in board size, at present the board comprises of three members along with independent representation. Additionally, four board committees have been formulated, namely, Audit, HR, Risk and Investment, however repetition of common members has been observed. Minimizing the same through inclusion of certified members in the board may improve governance framework.

Upgradation of rating takes into account Company’s sound business and financial sustainability, during the year the Company’s operational profile was observed to be under stress, however the same witnessed improvement end-HFY24 whereby uptick in capital gains provided support to the Company’s earning profile to some extent. Liquidity profile stands improved end-HFY24 and capitalization indicators remain manageable. While depicting a decline in FY23, the Company’s market risk remains on the higher side with short-term portfolio increasing to 80% of equity at the end-HFY24. Overall, financial profile of the Company is considered sound. However, retaining market share, diversifying revenue streams and improving operational efficiency along with capitalization indicators is considered important for rating.

For further information on this rating, please contact 021-35311861-64 or email at info@vis.com.pk.







Applicable Rating Criteria: Broker Fiduciary Ratings:
https://docs.vis.com.pk/Methodologies%202024/Broker-Fiduciary-Rating.pdf
VIS Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf

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 2024 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .