PACRA maintains Broker Management Rating of Optimus Capital Management (Pvt.) Limited
Optimus Capital Management (Pvt.) Limited ('OCM' or the 'Company') has a reliable presence in the corporate advisory space. Leveraging its market renown, OCM has supported its equity brokerage operations through revenue from advisory services and block trades. As a result, the low market volumes prevailing for the past two years have had minimal financial impact on the Company's performance. Currently, a small board comprising two executive directors exists; however, the planned inclusion of an independent director during the next board elections will enhance the governance framework moving forward. The management team comprises seasoned professionals that ensure the sound quality of services. The rating draws strength from the experienced profile and strong business acumen of the CEO and primary sponsor, Mr. Asif Ali Qureshi, who has been associated with the capital markets for over 25 years and is the current president of CFA society of Pakistan. The Company has a lean organizational structure. An in-house internal audit department is present to provide internal control support. The separation of key management roles such as risk and compliance has further enhanced the control framework. The rating also takes note of a sound customer relationship and IT infrastructure. A well-developed research department is in place to provide the clients with the necessary research services. A dedicated database management group company is present, reinforcing the research quality. OCM has added a dedicated online sales department whereas a customer services department is also currently being developed, further enhancing the Company's client services. Market risk is minimal as the Company does not actively partake in proprietary trades. Despite market volumes decreasing by ~33% during FY23 when compared with FY22, OCM's topline decreased by ~14% during the same period due to a significant contribution of ~PKR 57mln from advisory income. However, equity brokerage income declined by ~48% during FY23 when compared with FY22, due to a combination of low market volumes and decrease in commission rates by the Company to remain competitive. The rating draws comfort from the Company's zero-leveraged capital structure. OCM's strategy to leverage its presence in cyberspace to attract retail clientele may boost equity brokerage income moving forward.
Going forward, it is imperative from a rating perspective to maintain topline growth and revenue diversification. Maintenance and improvement in equity brokerage market share is critical moving forward. Moreover, retention of key management personnel, enhancement of client services, and further separation of management roles remain important.
Optimus Capital Management (Pvt.) Limited holds the Trading Rights Entitlement Certificate from the Pakistan Stock Exchange and licensed by the Securities & Exchange Commission of Pakistan. Previously known with the name of Millennium Capital Management (Pvt.) Limited, the Company was incorporated in 2004 and the name was changed to Optimus Capital Management (Pvt.) Limited in 2011. Optimus Capital Management (Pvt.) Limited is a wholly owned subsidiary of Optimus Holdings (Pvt.) Limited. The CEO, Mr. Asif Ali Qureshi and Mr. Jawad Amjad own 80% and 20% of Optimus Holdings, respectively. The sponsors possess more than ~20 years of the financial market related experience. The board is comprised of two executive directors including the CEO Mr. Asif Ali Qureshi and Mr. Syed Ayaz Ahmed.