Press Release
PACRA assigns Broker Fiduciary Rating to Venus Securities (Pvt.) Limited
Date: 15-Dec-23
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Rating Details | Rating Type | BFR | |
Dissemination Date | Current (15-Dec-23 ) | ||
Action | Initial | ||
Rating | BFR 3 | ||
Outlook | Stable | ||
Rating Watch | - |
Rating Rationale | Factor | Comment |
Ownership | Majority ownership vests with Mr. Asad Abdul Razzaq, having ~99.99% ownership stake in the Company. | |
Governance | A small two-member board provides governance for VSPL. The board consists of the CEO and his brother, indicating limited governance oversight. Three board committees are present with defined TORs; how | |
Management and Client Services | VSPL has an adequately qualified and experienced management team to run its operations. Client services are considered adequate with access to online trading and limited research reports present. | |
Internal Controls and Regulatory Compilance | An internal audit department exists; however, its scope is limited. The compliance function is directly overseen by the CEO, resulting in effective monitoring. | |
Business Sustainability | The topline of VSPL is concentrated to equity brokerage, resulting in limited resistance to market variabilities. VSPL earned brokerage revenue of ~PKR 5.3mln during FY23, and incurred loss after tax | |
Financial Sustainability | VSPL operates on a zero or low-leveraged capital structure. However, the low equity base of ~PKR 78mln at end-Jun'23 may be improved through internally generated profits or equity injection. |
Key Rating Drivers |
About the Entity | |
Legal Structure | Private Limited |
Year of Establishment | 06-Jun-07 |
Type of License | Trading Only |
Majority Ownership | Asad Abdul Razzaq (~99.99%) |
Regulatory Disclosures | Analyst | Applicable Criteria | Related Research |
Hassaan Ahmad Hassaan.Ahmad@pacra.com +92-42-35869504 www.pacra.com |
Methodology | Broker Fiduciary Rating | Jan-23 |
Sector Study | Brokerage & Securities | Jan-23 |
Disclaimer | This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA. The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor. |