PACRA Upgrades IFS Rating of Dawood Family Takaful Limited

The upgrade reflects the Company’s sustained improvement in profitability, robust premium growth, and a strengthening capital and liquidity profile. During CY25, the Company’s Gross Contribution (GPW) increased by ~20.7% YoY to PKR 2,632mln (CY24: PKR 2,180mln), led by a ~20.8% rise in individual contributions to ~PKR 2.38bln and a ~20.5% increase in group contributions to ~PKR 252.6mln. Profit Before Tax rose ~41% to PKR 148.8mln (CY24: PKR 105.6mln), while Profit After Tax more than doubled to PKR 99.8mln (CY24: PKR 43.0mln), translating into earnings per share of PKR 1.33 (CY24: PKR 0.57). For the first time, the Company’s profits were assessed under the Normal Tax Regime rather than the Minimum Tax Regime, reflecting the scale-up in core profitability. The Company’s combined equity base (Shareholders’ Fund plus Participant Takaful Fund) increased ~5% to PKR 2,631mln as of Dec-25 (Dec-24: PKR 2,505mln), while Total Assets rose to PKR 13,793mln (Dec-24: PKR 12,074mln). The Participant Investment Fund (PIF) grew ~17% to PKR 10.23bln (Dec-24: PKR 8.73bln), and the Participant Takaful Fund (PTF) stood at PKR 1.90bln (Dec-24: PKR 1.87bln). The Company distributed a surplus of PKR 172.6mln to participants during CY25 (CY24: PKR 154.2mln) and settled claims of PKR 1.6bln (CY24: PKR 1.2bln). The Company’s Liquid Investments to Equity ratio strengthened to ~4.43x (CY24: ~4.05x), reflecting continued accumulation of government securities and other liquid assets. The Company rationalized its branch network to 56 branches as of Dec-25 (Dec-24: 74 branches), as part of an ongoing distribution efficiency drive. During 1QCY25, the Company’s GPW was PKR 436mln, against a restated PKR 465mln in 1QCY26, while the Company posted a Shareholders’ Fund net loss of PKR 11.2mln, broadly in line with the PKR 11.2mln loss in 1QCY26. Management continues to monitor the situation, and the Company’s investment income remains sensitive to capital market movements. The Company currently meets the prevailing minimum paid-up capital requirement of PKR 700mln for life insurers/family takaful operators, with paid-up capital of PKR 750mln as of Dec-25. In March 2026, the Board approved an increase in Authorized Capital from PKR800mln to PKR1.6bln, in anticipation of SECP’s phased enhancement of minimum paid-up capital requirements, which envisages an eventual threshold of PKR 3bln for life insurers/family takaful operators. The management, in consultation with the Board, has devised a clear roadmap for capital enhancement. Timely and adequate capital augmentation, in line with this regulatory trajectory, remains a key rating sensitivity going forward.
The rating remains dependent on the Company sustaining its improved underwriting and core profitability, further strengthening its competitive positioning, and progressing on its capital enhancement plan in line with SECP’s revised regulatory capital framework. Adequate solvency, as reflected through reserves, must be maintained at all times.

About the Entity
Dawood Family Takaful Limited (‘Dawood Family Takaful’ or ‘the Company’) is a public unlisted Shariah-compliant company, incorporated in May-07. The Company started its takaful operations in May-08 and operates primarily in the individual and group family takaful business across a network of 56 branches in Pakistan (Dec-25). The Company belongs to BRR Group of Companies. The Board is chaired by Mr. Ayaz Dawood, while Mr. Ghazanfar-Ul-Islam heads the Company as Chief Executive Officer.