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The Pakistan Credit Rating Agency Limited
Press Release

Date
27-Dec-19

Analyst
Madiha Sohail
madiha.sohail@pacra.com
+92-42-35869504
www.pacra.com

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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

PACRA Maintains the Broker Management Rating of JS Global Capital Limited

Rating Type Broker Management
Current
(27-Dec-19 )
Previous
(28-Jun-19 )
Action Maintain Maintain
Long Term BMR1 BMR1
Short Term - -
Outlook Stable Stable
Rating Watch - -

The ratings reflect JS Global's strong brand, sizable market share, competitive positioning and extensive outreach to the retail segment. Despite the lackluster performance of the equity market and dwindling trading volumes, the Company maintained it's market share.The Company intends to further enhance its presence through branch network and strengthening operating platform, while developing new products. The rating incorporates JS Global's robust financial profile characterized by debt free capital structure and very strong risk absorption capacity owing to its healthy liquidity profile. The Company has defined investment limits through a formal policy to curtail market risk to an extent. The Company does not engage in proprietary trading in equities. The Company maintained the profitability, albeit small, despite low volumes of stock market. The management expects this trend to reverse, given recent improved performance and volumes in stock market. The ratings take into account the Company's association with a leading financial group,'JS Group' of the country.
The ratings are dependent on the management's ability to augment brokerage and other income by capitalizing on improved market sentiments. Retaining market share and sustaining profitability from core operations remain critical. Meanwhile, retention of key individuals and strengthening processes and procedures is important. Implementation of new software, resulting in better controls is critical in this regard.

About the Entity
JS Global, with commercial operations starting in May 2003, carries the legacy of stock brokerage business initiated in the early seventies by Mr. Jahangir Siddiqui. With its head office based in Karachi, the Company operates with ten branches across the country. Its main activities include brokerage, corporate finance, financial advisory, forex, and money market activities. The Company is listed on the Pakistan Stock Exchange (PSX). JS Bank Limited (JSBL) and Global Investment House (GIH) are the major shareholders of the Company each holding ~84% and ~10% stake in JS Global, respectively. Along with brokerage services, JS Global provides financial advisory services as well.

The Board of Directors (BoD) of JS Global comprises eight experienced professionals, including the CEO. Five directors are non-executive out of which three represent JS Bank, while two members are nominated by GIH. One female director is elected in compliance with Code of Corporate Governance. There are two independent directors.

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's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. 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.