PACRA Assigns Broker Entity Ratings to AL Habib Capital Markets (Pvt.) Limited

AL Habib Capital Markets (Pvt.) Limited ('AHCML' or the 'Company') is primarily engaged in the provision of equity brokerage while income from MTS and MFS also aids the topline. In CY25, Pakistan's stock market sustained its strong momentum, supported by relatively attractive market P/E multiples, easing interest rates, and continued improvement in key macroeconomic indicators. This sustained rally reinforced investor confidence and further increased trading volumes, maintaining a constructive outlook for the brokerage industry. The positive trajectory persisted throughout CY25, with the KSE-100 index repeatedly touching new historic highs during the year. CY26 is expected to remain favorable for the brokerage industry; however, factors such as political stability and the continuity of macroeconomic reforms will remain critical. Well-executed marketing initiatives allowed the Company to capitalize on the favorable market momentum, resulting in growth in AHCML’s brokerage revenue surging by ~36% during 9MCY25. As a result, AHCML’s profitability strengthened significantly, with profit after tax increasing to ~PKR 53mln in 9MCY24 compared to ~PKR 26mln in 9MCY24. Market risk is limited, with the proprietary investment book of the Company constituting ~13% of the equity at end-Sep'25. Furthermore, market risk is negligible as the Company invests its excess funds in PIBs (58% of the total investments). AHCML maintains a leveraged capital structure, with leveraging standing at ~53% at end-Sep'25. The Company has an adequate equity base of ~PKR 538mln as at end-Sep'25. The Company's ownership lies with Bank Al-Habib (the 'Bank') and the Habib family. The business acumen and financial strength of the primary sponsor contributes positively to the ratings. Representation of the Bank on the board is well noted and strengthens the governance framework; however, inclusion of independent representation on the board may improve oversight framework further. AHCML has a well-developed organizational structure with a qualified and experienced management team. The presence of a separate internal audit department enhances the control environment. The Company intends to enhance its technological infrastructure to streamline the onboarding process for retail clients. Additionally, management's plan to expand its geographic reach shall significantly contribute to increasing the Company's market share.
Going forward, sustainability of market share, revenue, and profitability will remain imperative, while upholding strong internal controls and risk management framework is critical. Further, retention of key management personnel and continued sponsor support remains important.

About the Entity
AL Habib Capital Markets (Pvt.) Limited, “AHCML or The Company” is a licensed TREC holder of Pakistan Stock Exchange and was incorporated under the Companies Ordinance 1984 in 2005 as private limited company. Bank AL Habib Limited (BAHL) is the major shareholder of AHCML, accounting for two‐third of the ownership. The remaining one‐third is held by Habib Family, friends and associates. The Company has 5 directors on the board including CEO and Chairman. The CEO, Mr. Aftab Q. Munshi possesses diversified experience in capital markets. He is also on the Board of Directors of AHCML as Chief Executive since its incorporation. Mr. Munshi served with the Jahangir Siddiqui Group for almost 12 years in multiple roles.