PACRA Maintains Broker Management Rating of AL Habib Capital Markets (Pvt.) Limited

AL Habib Capital Markets (Pvt.) Limited ("AHCML" or "the Company") is primarily engaged in equity brokerage, with income from MTS and MFS providing additional support to the topline. The KSE-100 Index maintained positive momentum during 1QCY26, enabling the brokerage industry to benefit from healthy trading activity and improved investor participation. While the outlook for CY26 remains favorable, external debt repayments, political uncertainty, regional geopolitical developments, and evolving global trade conditions continue to require prudent management oversight. The assigned rating reflects the business acumen of the primary sponsor, Bank Al Habib Limited, whose Board representation remains a key governance strength. The inclusion of an independent director would further strengthen governance oversight. The rating also incorporates AHCML's experienced management team, well-defined organizational structure, and commitment to internal controls through a dedicated internal audit function, while further segregation of risk and compliance functions would enhance the control framework. Management continues to strengthen the Company's service offering through online trading, a grievance redressal portal, research services, and a comprehensive Disaster Recovery and Business Continuity Plan. The addition of an Online Sales and Marketing function further demonstrates management's focus on enhancing client engagement and operational effectiveness. Management's execution of its business strategy translated into improved financial performance during 1QCY26. The Company benefitted from profit on income from MTS of ~PKR 10mln, income from client fund management of ~PKR 7mln, and profit on PSX/NCCPL exposures of ~PKR 6mln, alongside improved brokerage income, supporting overall profitability. Revenue, while remaining concentrated in equity brokerage, increased to ~PKR 74mln in 1QCY26 (SPLY: ~PKR 43mln), contributing to total revenue of ~PKR 105mln. The sustained improvement in brokerage income reflects management's ability to capitalize on favorable market conditions and effectively execute client acquisition and business development initiatives. Management has maintained an adequate capitalization profile through internal accruals, supporting the Company's financial resilience and capacity to absorb business risks. Equity stood at ~PKR 567mln (Dec'25: ~PKR 579mln), while the regulatory Liquid Capital Balance (LCB) improved to ~PKR 387mln (Dec'25: ~PKR 378mln) by end-Mar'26, reflecting prudent capital management. The proprietary investment book constituted approximately 10% of equity and stood at ~PKR 157mln at end-Mar'26, with Pakistan Investment Bonds (PIBs) accounting for ~63% of the portfolio, indicating management's relatively conservative investment approach aimed at balancing returns with risk considerations.
Going forward, sustainability of market share, revenue, and profitability will remain imperative, while upholding strong internal controls and risk management framework and retention of key management is critical. Further, rational diversification of business activity may provide support to the company’s overall financial risk profile.

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.