PACRA Maintains Broker Management Rating of Abbasi and Company (Pvt.) Limited

Abbasi and Company (Pvt.) Limited ("ACPL" or "the Company"), an established player in Pakistan's brokerage sector, continues to strengthen its market position through management's focus on revenue diversification, digital transformation, and prudent financial stewardship. The Company's earnings profile is supported by multiple income streams, including brokerage commissions from the Pakistan Stock Exchange (PSX) and Pakistan Mercantile Exchange (PMEX), margin financing services (MTS/MFS), returns on strategic investment portfolios, and profit-bearing bank deposits. Management's forward-looking growth agenda is reflected in its pursuit of a Separately Managed Account (SMA) license and Shariah-Compliant Brokerage License, which is expected to broaden the product suite, enhance access to new client segments, and further diversify revenues. The Company serves a diversified client franchise comprising local corporate, institutional, HNWI, retail, and foreign HNWI/retail investors. During 1HFY26, ACPL's client base expanded by 16%, reflecting management's success in client acquisition and retention initiatives, alongside growing investor confidence in the platform. The Company benefits from a stable ownership structure and established succession arrangements. While management has demonstrated effective execution capabilities and operational oversight, the governance framework would benefit from board expansion and the induction of independent directors to strengthen strategic guidance and oversight. Dedicated risk management, compliance, and disciplinary functions underscore management's commitment to sound controls, operational resilience, and regulatory compliance. The brokerage industry sustained strong momentum during 1HFY26, supported by elevated PSX trading activity and a buoyant equity market. The KSE-100 Index surpassed 170,000 points by December 2025, driven by monetary easing, improving macroeconomic indicators, and attractive market valuations. Strong investor participation continued to support sector growth. Within this operating environment, ACPL maintained a market share of approximately 0.3% on a traded-volume basis during 1HFY26. Management's execution capabilities translated into improved financial performance, with net operating revenue increasing to PKR 60.2 million (1HFY25: PKR 51.8 million), reflecting ~16% YoY growth, primarily driven by higher brokerage commissions. Gross profit rose to PKR 68.4 million (1HFY25: PKR 55.7 million), supported by stronger brokerage income and gains on the FVTPL portfolio. Despite higher administrative expenses of PKR 53.3 million (1HFY25: PKR 49.3 million), operating profit improved to PKR 15.0 million (1HFY25: PKR 6.4 million). Other income increased significantly to PKR 44.1 million (1HFY25: PKR 11.5 million), largely due to enhanced returns on bank deposits, resulting in profit after tax of PKR 53.5 million (1HFY25: PKR 14.3 million), up 274% YoY. Management continues to maintain a conservative, debt-free balance sheet, with equity strengthening to PKR 447.7 million as of December 2025 (June 2025: PKR 344.1 million), providing a strong buffer against market volatility while supporting strategic growth initiatives.
Going forward, the assigned rating remains dependent on management's ability to further strengthen governance practices, broaden the client franchise, and execute measured expansion initiatives. Continued diversification of revenue streams and disciplined risk management will remain critical to reducing concentration risk and enhancing business sustainability. Sustained profitability, capital preservation, and effective strategic execution by management are expected to underpin future growth and rating stability.

About the Entity
ACPL, a SECP-regulated and PSX-recognized brokerage house, has built its market presence since 1999. Also, holds Membership of the Pakistan Mercantile Exchange (PMEX). ACPL maintains strong family stewardship, with 90.85% ownership concentrated among the Abbasi family, led by Mr. Syed Muhammad Ismail Abbasi. The Company is overseen by a three-member Board, including the CEO.