PACRA assigns Initial Broker Fiduciary Rating to Khadim Ali Shah Bukhari Securities Limited
|Rating Details||Rating Type||Broker Fiduciary Rating|
|Ownership||Good||Major shareholding of the Company lies with Oxford Frontier Capital Limited i.e. ~44%. The sponsors' profile of the Company is considered good.|
|Governance||Good||On governance front, the Company is in process of improving its Board Structure in compliance with CCG.|
|Management and Client Services||Strong||Management team is well experienced while integration of technology into systems results in high efficiency and customer satisfaction.|
|Internal Controls and Regulatory Compilance||Good||Risk management framework and systems are adequate and company remains compliant with all applicable regulations.|
|Business Sustainability||Good||The Company registered a considerable growth amidst augmentation in client base but rating is constrained by the Company's significant dependence on equity brokerage income.|
|Financial Sustainability||Good||The Company is engaged in proprietary trading, albeit the quantum of proprietary investment is very low but exposes the Company to market risk.|
|Key Rating Drivers||
The broker fiduciary rating of Khadim Ali Shah Bukhari Securities Limited's ("The Company") (Formerly: Khadim Ali Shah Bukhari Securities Private Limited) signifies the Company’s assurance towards satisfactory custodianship of client’s assets indicated by comprehensive Client Asset Segregation policy, Trading room policy and Market abuse policy. The Company occupies emerging position in the brokerage industry and is penetrating through online trading and mobile application. The Company has outsourced its internal audit function to AFRAS & Company, a practicing firm of consultants. Zero leveraged capital structure, improved liquidity indicators and recovery in efficiency ratios bodes well for the Company. The ratings are dependent on the management’s ability to strengthen revenue base by augmenting consultancy and advisory services. Retaining market share and sustaining profitability from core operations remain critical. Meanwhile, upholding strong internal controls and diligent monitoring of risks is important.
|About the Entity|
|Legal Structure||Public Limited|
|Year of Establishment||06-Jan-13|
|Type of License||Trading and Self-clearing|
|Regulatory Disclosures||Analyst||Applicable Criteria||Related Research|
| Madiha Sohail
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