Press Release
Date: 27-Apr-22
PACRA Assigns Initial Broker Fiduciary Rating to JS Global Capital Limited

Rating Details Rating Type BFR
Dissemination Date Current (27-Apr-22 )
Action Initial
Rating BFR 1
Outlook Stable
Rating Watch -

Rating Rationale Factor Comment
Ownership JS Bank Limited is the primary shareholder with ~93% of the ownership, remaining shares are owned by general public and institutions.
Governance The Board is comprised of eight directors including the chairman and CEO. Presence of two independent and a female director is well noted.
Management and Client Services JSGCL has a well-defined organizational structure headed by seasoned professionals. Well drafted policies are in place to ensure high quality of client services.
Internal Controls and Regulatory Compliance The internal audit is performed at group level. A dedicated risk manager is also present along with the compliance department.
Business Sustainability Major part of revenue emanates from equity brokerage; however, investment banking, money market, forex and commodity brokerage desk provides support.
Financial Sustainability The Company does not engage in Proprietary-Book, thus minimizing market risk. Capitalization indicators are strong with a low leveraged capital structure.

Key Rating Drivers The rating reflects the overall strength of the Company in the brokerage space. The rating signifies strong internal control framework whereby the internal audit is performed at the group level while a separate compliance department and a dedicated risk manager also provides support. JS Global Capital Limited (JSGCL) provides its clients with online trading, mobile-app, complaint management, dedicated research and real time reporting mechanism. The rating takes comfort from the strong ownership and governance framework emanating from its association with the JS Group. However, the independence of risk management function may be considered to enhance regulatory compliance. During CY21, brokerage revenue improved by ~52% to stand at ~PKR 882mln (CY20: ~PKR 582mln), contributing ~83% to the total operating revenue. Consultancy income has also shown improvement in CY21. The rating derives comfort from JSGCL’s policy to not partake in Proprietary-Book; limiting the market risk. Going forward, sustainability and improvement in core revenue and profitability remains critical. Meanwhile, upholding strong internal controls, retention of key management and diligent monitoring of risk are important. Listed in 2005, JSGCL is part of one of the most prominent groups in the financial industry. JSGCL primarily provides the services of Equity Brokerage, Corporate Finance and Research while Margin Financing is also available.

About the Entity
Legal Structure Listed
Year of Establishment 28-Jun-00
Type of License Trading and Self-clearing
Majority Ownership JS Bank Limited

Regulatory Disclosures Analyst Applicable Criteria Related Research
Afnan Iqbal
afnan.iqbal@pacra.com
+92-42-35869504
www.pacra.com

Methodology | Broker Fiduciary Rating | Jan-21

Sector Study | Brokerage & Securities | Jan-22

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.