Karachi, August 2, 2016: JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has revised entity ratings assigned to AKD Securities Limited (AKDSL) from ‘A+/A-2’ (Single A Plus/A-Two) to ‘ A/A-2’ (Single A / A-Two). Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on January 6, 2016.
Legal proceedings by the FIA were initiated against the company including the arrests of some of its directors in January 2016, they have subsequently been released on bail in May 2016 by the Apex court and have returned to their positions. In the interim period, the business operations of the company experienced a downturn and human resource (HR) attrition was witnessed. A reduction in profitability was thus evidenced.
The sponsors and the management are making efforts to recoup the franchise and business position of the company. In this direction, recruitment of quality HR and attainment of earlier levels of corporate advisory and brokerage business are considered important. These along with the settlement of holding and associate companies’ liabilities and the conclusion of legal proceeding would be among the rating drivers, going forward.
For further information on this rating announcement, please contact the undersigned (Ext: 234) or Mr. Mohammed Khalid Ali (Ext: 241) at (021)35311861-70 or fax to (021)35311872-3.
Applicable Rating Criteria: Methodology - Securities Firms Rating (May 2015) http://www.jcrvis.com.pk/Images/Securities%20methodology%201%20-2015.pdf
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