Press Release

VIS Upgrades Broker Fiduciary Rating of Sherman Securities (Private) Limited

Karachi, April 29, 2025: VIS Credit Rating Company Ltd. (VIS) has upgraded Broker Fiduciary Rating of Sherman Securities (Private) Limited (SSPL) from BFR3+ to BFR3++. Rating of ‘BFR3++’ denotes good fiduciary standards. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on September 25, 2023.

The rating signifies sound Ownership & Governance, Management & Client Services, and Internal Control and Regulatory Compliance. Business & Financial Sustainability of the Company is considered adequate.

SSPL was incorporated in 2002. The principal activities of the Company are investments, brokerage services, Initial Public Offer (IPO) underwriting, and portfolio management. Majority shareholding is vested with Mr. Muhammad Samin Younus. The Company operates through its head office which is based in Karachi. SSPL is registered with Securities & Exchange Commission of Pakistan (SECP) and holds Trading Rights Entitlement Certificate (TREC) for Trading and Self Clearing (TSC) granted by Pakistan Stock Exchange Limited (PSX). External auditors of the company are Rahman Sarfaraz Rahim Iqbal Rafiq Chartered Accountants. External auditors are from Category ‘A’ of State Bank of Pakistan’s panel of auditors.

Assigned rating of the Company incorporates the Ownership & Governance framework, supported by a board of directors of 5 members, including two independent representations. However, inclusion of certified as well as more independent directors may further enhance the Company’s governance structure. The rating also factors in sound management and client services, with various facilitation tools to streamline processes. Enhancing the visibility of the customer grievance tool on the website and providing prompt trade alerts upon execution may further improve client services. While contingency measures are in place, increasing the frequency of disaster recovery exercises may further strengthen the same. The Company’s Internal Control and Regulatory Compliance are considered sound, with established policies and procedures. However, enhancement in the scope of the same may be considered.

Rating upgrade is on account of the Company’s financial profile, characterized by a significant rebound in the Company’s profitability in FY24 and 6MFY25, driven by sound realized and unrealized gains, along with higher brokerage income resulting from surge in industry volumes, supported by favorable market dynamics and improved macroeconomic indicators. Resultantly, operational efficiency of the Company witnessed improvement. Liquidity profile of the Company is considered sound while market risk is elevated. Capitalization profile of the Company benefits from a conservative capital structure. Additionally, the Company’s equity base has witnessed a sizeable increase in line with higher profitability. Going forward, diversifying revenue base, continued enhancement in the profitability profile as well as maintaining liquidity and capitalization profile will be important for the rating.

For further information on this rating, please 021-35311861-64 or email at info@vis.com.pk



Applicable Rating Criteria: Broker Fiduciary Ratings:
https://docs.vis.com.pk/Methodologies%202024/Broker-Fiduciary-Rating.pdf

VIS Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS , the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2025 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .