Optimus Capital Management (Pvt.) Limited

CREDIT RATING REPORT | Apr-25

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Rating History
Dissemination Date Long-Term Rating Short-Term Rating Outlook Action Rating Watch
04-Apr-25 A- A2 Stable Maintain -
05-Apr-24 A- A2 Stable Maintain -
07-Apr-23 A- A2 Stable Maintain -
08-Apr-22 A- A2 Stable Maintain -
09-Apr-21 A- A2 Stable Maintain -
About the Entity

Optimus Capital Management (Pvt.) Limited (“OCM”) is a PSX-licensed brokerage firm regulated by the Securities & Exchange Commission of Pakistan (SECP). Originally incorporated in 2004 as Millennium Capital Management (Pvt.) Limited, the Company was rebranded to OCM in 2011. It operates as a wholly-owned subsidiary of Optimus Holdings (Pvt.) Limited, with ownership split between Mr. Jawad Amjad (74%) and Mr. Yasin Iqbal Kodvani (26%). OCM’s board comprises two executive directors: Mr. Syed Ayaz Ahmed and Mr. Yasin Iqbal Kodvani, who bring 10 and 7 years of financial markets expertise, respectively. The firm is well-positioned as a trusted player in Pakistan’s capital markets, leveraging its regulatory compliance, experienced leadership, and strong governance framework.

Rating Rationale

Optimus Capital Management (Pvt.) Limited ('OCM' or the 'Company') primarily focuses on Equity brokerage services while advisory services and block trades services are also provided. The brokerage sector faced significant headwinds in FY22-FY23, constrained by monetary tightening cycles and persistent inflationary pressures, which suppressed investor risk appetite. However, 2QFY24 marked a structural inflection point, with the KSE-100 Index achieving unprecedented valuation thresholds, driven by improved liquidity conditions and institutional participation. This momentum sustained through 2HFY24, with the benchmark consolidating within a 70,000-80,000 basis point corridor, followed by a historic breach of the 100,000 psychological barrier in 1HFY25 (November 2024), catalysed by monetary easing cycles and macroeconomic stabilization measures. OCM operates as a wholly-owned subsidiary of Optimus Holdings (Pvt.) Limited. The Company’s governance structure currently features a compact Board of Directors, led by two executive members: Mr. Syed Ayaz Ahmad and Mr. Yasin Iqbal Kodvani, both seasoned professionals with over 17 years of combined expertise in Pakistan’s capital markets ecosystem, including specialized proficiency in macroeconomic research and institutional portfolio strategy. To align with governance benchmarks, OCM acknowledges the strategic imperative to augment board composition through the inclusion of independent non-executive directors, thereby enhancing oversight rigor and stakeholder confidence. OCM’s streamlined organizational architecture is supported by a strong client franchise and enterprise-grade technological infrastructure, enabling seamless trade execution and real-time risk management. The Company’s dedicated investment research division delivers alpha-generating insights, underpinning its value proposition to institutional and retail clientele. As of December 2024, OCM maintains a proprietary trading portfolio valued at PKR 22 million, complementing its core brokerage operations. The Company reported 1HFY25 revenues of PKR 108 million, reflecting a 120% YoY expansion in brokerage commissions (PKR 90 million vs. SPLY: PKR 50 million). OCM’s unleveraged balance sheet remains a cornerstone of its credit strength, with an equity base of PKR 308 million as of December 2024, ensuring ample liquidity buffers and capital preservation capacity.

Key Rating Drivers

Going forward, it is imperative from a ratings perspective to maintain topline growth, revenue diversification, and profitability. Maintenance and improvement in market share remains important. The inclusion of independent representation may be considered to strengthen the governance framework. Moreover, retention of key management personnel and further separation of management roles remain critical.

REPORT CONTENTS
  1. Rating Analysis
  2. Financial Summary
  3. Rating Scale
  4. Regulatory Disclosure

Optimus Capital Management (Pvt.) Limited

rating analysis

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Profile
Background

Optimus Capital Management (Pvt.) Limited ('OCM' or the 'Company') was incorporated in March 2004 and became operational under the name of Optimus Capital Management (Pvt.) Limited in June 2011. The Pakistan Stock Exchange has granted the Company a Trading Right Entitlement Certificate (TREC).


Operations

OCM mainly offers equity services including ready and Future dealings, whereas advisory services are also offered. The Company has started dealing in Margin Trading System (MTS) transactions. The brokerage clients are divided into three broad segments; i) Foreign ii) Institutions/Corporate and iii) Retail, Recently, OCM had an increased presence in the retail segment; they have enhanced their retail footprint from online market.


Ownership
Ownership Structure

Optimus Holdings is the parent company that owns OCM. Mr. Jawad Ahmad and Mr. Yasin Iqbal Kodvani are the sponsors of Optimus Holdings with 74% and 26% shareholding respectively. Previously, Mr. Jawad and Mr. Asif had equal shareholding in Optimus Holdings however, Mr. Jawad joined PNO, a private equity fund, as the CEO. According to the NBFC rules, CEO of any NBFC cannot hold more than 20% shares of any company therefore, Mr. Jawad transferred 30% of his shareholding in Optimus Holdings to Mr. Asif.


Stability

The parent company Optimus Holding (Pvt.) Limited has a strong financial base and has strategic investments in numerous companies. Optimus Holdings (Pvt.) Limited remains on the front foot to support the company.


Business Acumen

The sponsors have relevant educational background and also have vast experience in the financial services sector. In addition to Optimus Holdings the sponsors have shareholding in other entities; PNO, Optimus Market (Pvt.) Limited and Zakheera (Pvt.) Limited.


Financial Strength

The sponsors have adequate financial strength and may inject further equity with increasing quantum of operations.


Governance
Board Structure

After the resignation of Mr. Asif Ali Qureshi, the board of directors (BOD) of OCM comprises of two experienced professionals Mr. Syed Ayaz Ahmed and Mr. Yasin Iqbal Kodvani. The directors are executive, and the board may be enhanced with the induction of certified independent directors.


Members’ Profile

Mr. Syed Ayaz Ahmed and Mr. Yasin Iqbal Kodvani are the directors of the Company and have more than 1 decade and 6 years of experience respectively in Pakistan's financial sector with expertise in economic and investment research.


Board Effectiveness

The experience of board helps in providing useful insight into the business management and guiding the management in effectively developing optimizing the organizational procedures and policy.


Transparency

Head of internal audit reports directly to the internal audit committee. Riaz Ahmad, Saqib, Gohar & Company are the external auditors of the Company. The auditor is ranked as Category B auditor on the panel of SBP auditors list.


Management
Organizational Structure

OCM has a lean organizational structure with experienced management team and a balanced mix of professional from finance industry. The functions of the company are mainly divided into: 1) Sales. 2) Accounts, 3) Research, 4) Settlement, 5) IT 6) Compliance 7) Online Trading and 8) Admin, An Online Sales department has recently been added to realize the Company's strategy of enhancing its retail presence.


Management Team

The management team comprises of well qualified and experienced individuals. Mr. Syed Ayaz Ahmed and Mr. Yasin Iqbal Kodvani have taken charge as CEO of the Company after the resignation of Mr. Asim. Mr. Ayaz and Mr. Yasin posses over 10 years and 6 years of experience respectively in financial sector.


Management Effectiveness

The integration of the front and back office software produces real-time MIS reports that enable the management to take quick decisions and effectively monitor risks.


Control Environment

The Company has developed an extensive risk management policy encompassing exposure limits, margins, KYC/CDD, customer orders, as well as execution and settlement process. The settlement department is responsible for conducting through KYC/CDD procedures for each customers, categorizing them into varying risk levels ranging from low to high. High-risk customers undergo enhanced due diligence through continuous monitoring.


Business Risk
Industry Dynamics

The brokerage industry struggled in FY22 and FY23 due to high interest rates and inflation, limiting investor interest. 1QFY24 saw continued pressure, but 2QFY24 brought a rebound, pushing the KSE-100 to record highs. The market maintained strong volumes in 2HFY24, trading between 70K-80K. In 1HFY25, the index crossed 100K in November 2024, driven by interest rate cuts and economic stability. However, political uncertainty remains a key factor as investors await policy direction from the new government.


Relative Position

The Company holds market share of approximately 2%.


Revenues

The Company's operating revenue mainly comprises equity brokerage income. During 1HFY25 the main source of revenue stemmed from equity brokerage, so Equity brokerage revenue stood at ~PKR 90mln. At the end of Dec 24, the net income stood at ~PKR 108mln.


Cost Structure

The Company's operating expenses were ~PKR 82mln in 1HFY25. Salaried & other benefits contributed the most to these expenses ~PKR 50mln.


Sustainability

Going forward, the Company is expected to improve and sustain profitability and diversify revenue stream. Meanwhile, the focus of the brokerage house would be to engage more Retail and HNWI's that would help the management to enhance its market share.


Financial Risk
Credit Risk

For the assessment of client's credit worthiness, the Company has formulated detailed KYC/CDD policies. These policies entail customer identification, risk assessment, due diligence and compliance function. Exposure limits are properly assigned. An automated risk management system is in place that halts transactions for a particular client if margin falls below the allocated level.


Market Risk

Optimus Capital Management (Pvt.) Limited does not engage in proprietary investments, thus limiting the impact of market risk. The Company's short-term investments were ~PKR 22mln at end-Dec'24.


Liquidity Risk

At end-Dec'24, the current assets of the Company stood at ~PKR 11mln against the current liabilities of ~PKR 12mln.


Capital Structure

At end 1HFY25, the Liquid Capital Balance (LCB) of the Company stood at ~PKR 196mln. The Company has an equity base of ~PKR 308mln at end-Dec'24. 
 
 

Apr-25

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Optimus Capital Management (Pvt.) Limited

financial summary

(PKR mln)

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Dec-24
6M		 Jun-24
12M		 Jun-23
12M		 Jun-22
12M
Management Audited Audited Audited
A. BALANCE SHEET
1. Finances 0 2 0 0
2. Investments 38 43 51 101
3. Other Earning Assets 194 0 195 132
4. Non-Earning Assets 107 281 152 206
5. Non-Performing Finances-net 0 0 0 0
Total Assets 339 326 399 439
6. Funding 3 4 41 86
7. Other Liabilities (Non-Interest Bearing) 3 4 11 6
Total Liabilities 6 8 52 92
Equity 333 318 346 347
B. INCOME STATEMENT
1. Fee Based Income 94 99 128 154
2. Operating Expenses (83) (144) (152) (137)
3. Non Fee Based Income 14 63 42 18
Total Opearting Income/(Loss) 25 18 18 34
4. Financial Charges 0 0 (1) (2)
Pre-Tax Profit 25 18 17 33
5. Taxes (1) (0) (15) (16)
Profit After Tax 25 18 2 16
C. RATIO ANALYSIS
1. Cost Structure
Financial Charges / Total Opearting Income/(Loss) -0.0% 0.0% 5.5% 5.1%
Return on Equity (ROE) 7.5% 15.5% 1.6% 10.1%
2. Capital Adequacy
Equity / Total Assets (D+E+F) 98.4% 97.4% 86.9% 79.1%
Free Cash Flows from Operations (FCFO) / (Financial Charges + Current Maturity of Long Term Debt + Uncovered Short Term Borrowings) 505720.0% N/A -1335.1% -2131.6%
3. Liquidity
Liquid Assets / Total Assets (D+E+F) 15.7% 20.5% 25.5% 48.0%
Liquid Assets / Trade Related Liabilities 1946.1% N/A 247.0% 260.9%
4. Credit & Market Risk
Accounts Receivable / Short-term Borrowings + Advances from Customers + Payables to Customers -4517.2% N/A 20.7% 34.8%
Equity Instruments / Investments 60.7% 10.0% 8.4% 5.9%

Apr-25

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Optimus Capital Management (Pvt.) Limited

rating scale

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Apr-25

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Optimus Capital Management (Pvt.) Limited

regulatory disclosure

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  1. Rating Team Statements
    1. Rating is just an opinion about the creditworthiness of the entity and does not constitute a recommendation to buy, hold, or sell any security of the entity rated or to buy, hold, or sell the security rated, as the case may be. (Chapter III; 14-3-(x))
    2. Conflict of Interest
      1. The Rating Team or any of their family members have no interest in this rating (Chapter III; 12-2-(j))
      2. PACRA, the analysts involved in the rating process, and members of its rating committee and their family members do not have any conflict of interest relating to the rating done by them (Chapter III; 12-2-(e) & (k))
      3. The analyst is not a substantial shareholder of the customer being rated by PACRA [Annexure F; d-(ii)]
      4. Explanation: for the purpose of the above clause, the term "family members" shall include only those family members who are dependent on the analyst and members of the rating committee.
  2. Restrictions
    1. No director, officer, or employee of PACRA communicates the information acquired by him for use for rating purposes to any other person, except where required under law to do so. (Chapter III; 10-(5))
    2. PACRA does not disclose or discuss with outside parties or make improper use of the non-public information which has come to its knowledge during a business relationship with the customer. (Chapter III; 10-7-(d))
    3. PACRA does not make proposals or recommendations regarding the activities of rated entities that could impact a credit rating of the entity subject to rating. (Chapter III; 10-7-(k))
  3. Conduct of Business
    1. PACRA fulfills its obligations in a fair, efficient, transparent, and ethical manner and renders high standards of services in performing its functions and obligations. (Chapter III; 11-A-(a))
    2. PACRA uses due care in the preparation of this Rating Report. Our information has been obtained from sources we consider to be reliable, but its accuracy or completeness is not guaranteed. PACRA does not, in every instance, independently verify or validate information received in the rating process or in preparing this Rating Report. (Clause 11-(A)(p))
    3. PACRA prohibits its employees and analysts from soliciting money, gifts, or favors from anyone with whom PACRA conducts business. (Chapter III; 11-A-(q))
    4. PACRA ensures before the commencement of the rating process that an analyst or employee has not had a recent employment or other significant business or personal relationship with the rated entity that may cause or may be perceived as causing a conflict of interest. (Chapter III; 11-A-(r))
    5. PACRA maintains the principle of integrity in seeking rating business. (Chapter III; 11-A-(u))
    6. PACRA promptly investigates in the event of misconduct or a breach of the policies, procedures, and controls, and takes appropriate steps to rectify any weaknesses to prevent any recurrence, along with suitable punitive action against the responsible employee(s). (Chapter III; 11-B-(m))
  4. Independence & Conflict of Interest
    1. PACRA receives compensation from the entity being rated or any third party for the rating services it offers. The receipt of this compensation has no influence on PACRA’s opinions or other analytical processes. In all instances, PACRA is committed to preserving the objectivity, integrity, and independence of its ratings. Our relationship is governed by two distinct mandates: i) rating mandate - signed with the entity being rated or issuer of the debt instrument, and ii) fee mandate - signed with the payer, which can be different from the entity.
    2. PACRA does not provide consultancy/advisory services or other services to any of its customers or their associated companies and associated undertakings that are being rated or have been rated by it during the preceding three years, unless it has an adequate mechanism in place ensuring that the provision of such services does not lead to a conflict of interest situation with its rating activities. (Chapter III; 12-2-(d))
    3. PACRA discloses that no shareholder directly or indirectly holding 10% or more of the share capital of PACRA also holds directly or indirectly 10% or more of the share capital of the entity which is subject to rating or the entity which issued the instrument subject to rating by PACRA. (Chapter III; 12-2-(f))
    4. PACRA ensures that the rating assigned to an entity or instrument is not affected by the existence of a business relationship between PACRA and the entity or any other party, or the non-existence of such a relationship. (Chapter III; 12-2-(i))
    5. PACRA ensures that the analysts or any of their family members shall not buy, sell, or engage in any transaction in any security which falls in the analyst’s area of primary analytical responsibility. This clause, however, does not apply to investments in securities through collective investment schemes. (Chapter III; 12-2-(l))
    6. PACRA has established policies and procedures governing investments and trading in securities by its employees and for monitoring the same to prevent insider trading, market manipulation, or any other market abuse. (Chapter III; 11-B-(g))
  5. Monitoring and Review
    1. PACRA monitors all the outstanding ratings continuously, and any potential change therein due to any event associated with the issuer, the security arrangement, the industry, etc., is disseminated to the market immediately and in an effective manner after appropriate consultation with the entity/issuer. (Chapter III; 17-(a))
    2. PACRA reviews all the outstanding ratings periodically on an annual basis. Provided that public dissemination of annual review and in an instance of change in rating will be made. (Chapter III; 17-(b))
    3. PACRA initiates an immediate review of the outstanding rating upon becoming aware of any information that may reasonably be expected to result in downgrading of the rating. (Chapter III; 17-(c))
    4. PACRA engages with the issuer and the debt securities trustee to remain updated on all information pertaining to the rating of the entity/instrument. (Chapter III; 17-(d))
  6. Probability of Default
    1. PACRA’s Rating Scale reflects the expectation of credit risk. The highest rating has the lowest relative likelihood of default (i.e., probability). PACRA’s transition studies capture the historical performance behavior of a specific rating notch. Transition behavior of the assigned rating can be obtained from PACRA’s Transition Study available at our website. (www.pacra.com) However, the actual transition of rating may not follow the pattern observed in the past. (Chapter III; 14-3(f)(vii))
  7. Proprietary Information
    1. All information contained herein is considered proprietary by PACRA. Hence, none of the information in this document can be copied or otherwise reproduced, stored, or disseminated in whole or in part in any form or by any means whatsoever by any person without PACRA’s prior written consent.

Apr-25

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