Rating Details	Rating Type	BFR
	Dissemination Date	Current (12-May-23 )	Previous (12-May-22)
	Action	Upgrade	Upgrade
	Rating	BFR 2	BFR 3++
	Outlook	Stable	Stable
	Rating Watch	-	-

Rating Rationale	Factor	Comment
	Ownership	Major stakes are owned by Oxford Frontier Capital, a UK based Fintech focused VC/PE firm which provides KTrade access to capital, expertise and global networking.
	Governance	The rating upgrade factors in the strengthening of governance structure and transparency with the diverse board and presence of independent directors.
	Management and Client Services	The rating takes comfort from a well-defined organizational structure and experienced management team. The integration of a customized CRM module has led to efficient reporting and increased customer
	Internal Controls and Regulatory Compliance	KTrade has further strengthened the control framework with the recent appointment of a separate head of risk management.
	Business Sustainability	KTrade's primary revenue stream is derived from equity brokerage, although diversification is present through its offerings in corporate finance while KTrade has also established a money market desk t
	Financial Sustainability	KTrade mitigates market risk by refraining from engaging in proprietary book investments. KTrade has managed to retain its market share despite of declining market volumes and economic uncertainty.

Key Rating Drivers

The rating upgrade incorporates the strengthening of the internal control framework with the appointment of a separate head of risk management in addition to an outsourced internal audit and dedicated compliance function. The assigned rating takes comfort from a management team consisting of seasoned professionals providing the clients with access to a state-of-the-art mobile app and services such as web-based trading and up-to-date research reports. The rating accounts for the strong sponsors’ profile and a sound governance structure which has strengthened further with the addition of two independent directors. Financially, KTrade has performed in line with the market and has successfully managed to sustain its market share. To further enhance the financial viability, KTrade is making efforts to increase inflow from corporate finance, commodity trading, and money market desk. Going forward, the sustainability of the topline with a focus on cost control and upholding a strong control framework will remain critical for the assigned rating.

About the Entity
	Legal Structure	Public Limited
	Year of Establishment	25-Apr-13
	Type of License	Trading and Self-clearing
	Majority Ownership	Oxford Frontier Capital Limited | ~60%

Regulatory Disclosures	Analyst	Applicable Criteria	Related Research
	Afnan Iqbal afnan.iqbal@pacra.com +92-42-35869504 www.pacra.com	Methodology | Broker Fiduciary Rating | Jan-23	Sector Study | Brokerage & Securities | Jan-23

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.