Karachi: The Pakistan Credit Rating Agency Limited (PACRA) has maintained the Insurer Financial Strength (IFS) rating of Dawood Family Takaful Limited, reflecting the company's sustained improvement in profitability, robust premium growth, and a strengthening capital and liquidity profile. The rating underscores the company's performance in CY25, where Gross Contribution (GPW) saw a notable increase of approximately 20.7% year-on-year to PKR 2,632 million, driven by significant rises in both individual and group contributions.
According to PACRA, Dawood Family Takaful Limited experienced a substantial profit before tax increase of around 41%, amounting to PKR 148.8 million, while profit after tax more than doubled to PKR 99.8 million. This improvement in profitability translated into an earnings per share of PKR 1.33. For the first time, the company's profits were assessed under the Normal Tax Regime, indicating a scale-up in core profitability. The company's equity base grew by approximately 5% to PKR 2,631 million, and total assets increased to PKR 13,793 million.
The company's Participant Investment Fund grew by about 17% to PKR 10.23 billion, and the Participant Takaful Fund stood at PKR 1.90 billion. During CY25, Dawood Family Takaful Limited distributed a surplus of PKR 172.6 million to participants and settled claims worth PKR 1.6 billion. The Liquid Investments to Equity ratio improved to approximately 4.43x, highlighting the accumulation of government securities and other liquid assets.
The company rationalized its branch network from 74 to 56 branches as of December 2025, as part of a distribution efficiency drive. During the first quarter of CY25, GPW was recorded at PKR 436 million, and the company reported a shareholders' fund net loss of PKR 11.2 million, consistent with the loss in the first quarter of CY26. The management continues to monitor capital market movements, with investment income remaining sensitive to these fluctuations.
The company meets the current minimum paid-up capital requirement of PKR 700 million, with a paid-up capital of PKR 750 million as of December 2025. In anticipation of the Securities and Exchange Commission of Pakistan's (SECP) phased enhancement of minimum paid-up capital requirements, the company's board approved an increase in authorized capital from PKR 800 million to PKR 1.6 billion. The regulatory trajectory envisages an eventual threshold of PKR 3 billion for life insurers and family takaful operators.
PACRA emphasized that the rating's sustainability depends on Dawood Family Takaful Limited maintaining its improved underwriting and core profitability, enhancing competitive positioning, and progressing on its capital enhancement plan in compliance with SECP's revised regulatory capital framework. Adequate solvency, as demonstrated through reserves, must also be maintained.