Press Release

VIS Reaffirms Entity Ratings of Mohammad Munir Mohammad Ahmed Khanani Securities

Karachi, November 07, 2022: VIS Credit Rating Company Ltd. (VIS) has reaffirmed entity ratings of Mohammad Munir Mohammad Ahmad Khanani Securities (MMK) at ‘A-/A-2’ (Single A Minus/A-Two). 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’. Previous rating action was announced on August 17, 2021.

Assigned ratings continue to draw comfort from competitive market share with extensive branch network and retail clientele as a competitive strength. MMK is operating total 22 branches nationwide, which is the highest number branches in comparison to its peers. These branches operate independently, and regardless of profitability, the house receives one-third of gross revenue as per agreed terms. Ratings further incorporate strong capitalization as reflected by sizeable equity base, improving leverage metrics in line with the decrease in trading volumes and sound liquidity profile with sufficient coverage of total liabilities in relation to liquid assets. However, given sizable investment book and active participation in proprietary trading, market risk remains elevated and continues to be a rating constraint. Corporate governance framework is deemed adequate; however, there is room for improvement in terms of separating the positions of CEO and Board Chairman.

Amid low market volumes, MMK managed to post positive operating profit; however, bottom-line was significantly impacted due to sizeable revaluation losses. On average, around one half of core revenue is derived from equity brokerage activities (with majority of revenues contributed from retail clientele), followed by dividend income, margin financing income, rental proceeds and underwriting service income. Since last review, total 4 new branches were added to the branch network. Management remains focused toward expansion of retail footprint by leveraging digital platforms. Alongside, the management intends to open marketing/facilitation centers in the near future.

For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 203) or the undersigned (Ext. 201) at 021-35311861-70 or email at

Javed Callea

Applicable rating criteria: Methodology – Securities Firms Rating (July 2020)

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