Rating Details	Rating Type	BFR
	Dissemination Date	Current (17-Jul-26 )	Previous (18-Jul-25)
	Action	Maintain	Maintain
	Rating	BFR 2+	BFR 2+
	Outlook	Stable	Stable
	Rating Watch	-	-

Rating Rationale	Factor	Comment
	Ownership	The assigned rating incorporates the business acumen of the primary sponsor "Bank Al Habib Limited", which owns ~67% of the ownership. The remaining shares are held by the Habib Family, friends and associates.
	Governance	The Company has 5 directors on board, 4 non executive and 1 executive director. Representation of the primary sponsor on the board is well noted. The addition of independent directors to the board would strengthen governance oversight.
	Management and Client Services	The Company has well developed organizational structure to manage its operations and appropriate policies to protect the clients interest.
	Internal Controls and Regulatory Compilance	The Company maintains a dedicated internal audit function, supported by the board Audit Committee. The risk assessment approach is guided by established KYC, CDD, AML, and CFT practices.
	Business Sustainability	The Company's revenue remains concentrated in equity brokerage, which stood at ~PKR 74mln in 1QCY26 (SPLY: ~PKR 43mln), while the total revenue stood at ~PKR 105mln.
	Financial Sustainability	The prop book of the Company constitutes 10% of the equity and stood at ~PKR 157mln at end Mar '26. Pakistan Investment Bonds (PIBs) contribute ~63% to the prop book at end Mar '26.

Key Rating Drivers

AL Habib Capital Markets (Pvt.) Limited ("AHCML" or "the Company") maintains a diversified operating model anchored in equity brokerage. Supported by improving macroeconomic conditions and favorable equity market activity during 1QCY26, the Company benefitted from income from MTS ~PKR 10mln, client fund management ~PKR 7mln, gains on PSX/NCCPL exposures ~PKR 6mln, alongside improved brokerage income, supporting profitability. Capitalization strengthened through internal accruals, with equity at ~PKR 567mln (Dec'25: ~PKR 579mln) and LCB increasing to ~PKR 387mln (Dec'25: ~PKR 378mln) by end-1QCY26. Fiduciary standards across client asset protection, segregation of client assets, compliance architecture, and risk management remain embedded within the control environment and continue to underpin the rating. Nevertheless, governance remains sponsor-centric and revenue concentration persists. Going forward, strengthening governance architecture, operational controls, client asset safeguards, proprietary risk governance, and revenue diversification will remain important to preserving fiduciary standards and reinforcing the overall control environment.

About the Entity
	Legal Structure	Private Limited
	Year of Establishment	23-Aug-05
	Type of License	Trading and Self-clearing
	Majority Ownership	Bank AL Habib Limited

Regulatory Disclosures	Analyst	Applicable Criteria	Related Research
	Usama Ali usama.ali@pacra.com +92-42-35869504 www.pacra.com	Methodology | Rating Modifiers | Apr-25 Assessment Framework | Broker Fiduciary Rating | Jan-26	Sector Study | Brokerage Firms | Feb-26

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