Karachi, November 14, 2022 (PPI-OT):VIS Credit Rating Company Ltd. (VIS) has maintained Broker Fiduciary Rating of ‘BFR3+’ to MRA Securities Limited (MRASL). Rating of BFR3+ denotes good fiduciary standards. Outlook on the assigned rating is ‘Negative’. The rating reflects sound management and client services and internal controls while governance framework and business and financial sustainability is considered adequate.

Assigned rating factors in MRASL’s sound internal control framework and management and client servicing procedures, which can be further strengthened through availability of research reports on website along with segregation of trade commission structure between retail and institutional client as well as effective enforcement of customer complaints. Rating also takes into account small board size under governance framework. Also repetition of members has been observed across the committees. Improvement in the same may strengthen governance level.

Revision in rating outlook is reflective of the downturn in the financial performance of the Company owing to a contraction in market activities. Amidst slowdown in market activity, MRASL’s profitability profile weakened led by losses on the back of capital loss and decrease in core brokerage revenue in FY22. Market risk remains elevated with a sizeable propriety book. Liquidity profile of the Company remains adequate while higher equity base relative to peers and manageable leverage and gearing levels extends support to capitalization indicators of the Company. Going forward, with market performance projected to remain subdued, profitability is expected to remain under pressure, which will remain important for rating perspective.

MRASL is a public unlisted company principally engaged in provision of equity brokerage services to domestic clients. Majority shareholding in MRA is vested with the Rafiq family. Currently, the brokerage operates through its head office based in Karachi. The company holds a Trading Right Entitlement Certificate (TREC) for Trading and Self Clearing services issued by the Pakistan Stock Exchange Limited (PSX).

For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/