PACRA maintains Stability Rating of Alhamra Wada Fund

Alhamra Wada Fund is a very low risk-profile open-ended fund. The duration of the Fund is perpetual; however, allocation plan(s) launched by the MCBIM under this Fund may be perpetual or may have fixed maturity. The objective of the Fund is to provide an attractive promised return at maturity of the Allocation Plans under the Fund, by investing in shariah compliant fixed-income securities. Since the Fund is not directly offering its units to the investor, rather the offering shall only be made through allocation Plans launched from time to time under the umbrella of this Fund.
Currently, Alhamra Wada Plan VII, VIII, X and XI are under the umbrella of the Fund. The plans will invest in authorized avenues to meet investment objectives, with the Management Company ensuring promised returns valid for investors staying invested until plan maturity. Investment avenues for the plans are government securities, cash, money market placements, certificates of deposits and musharakas, and TDRs.
Plan VII has invested 92.7% in GoP Ijara sukuk and ~6.4% in AA rated bank as of Oct'23. The WAM and duration of the Plan was 158 days at the end of Oct’23, exposing to high credit and interest rate risk. However, since the investment is in GoP Ijara Sukuk, the credit risk is at a manageable level. The top ten investor concentration stood at ~62% as of Oct’23; representing moderate redemption pressure. The redemption pressure is on the lower side due to fixed maturity plan.
Plan VIII has invested ~92.7% in GoP Ijara sukuk and ~1% in AA rated bank as of Oct'23. The WAM and duration of the Plan was 236 days at the end Oct’23, exposing the Plan to high credit and interest rate risk. However, since the investment is in GoP Ijara Sukuk, the credit risk is at a manageable level. The top ten investor concentration stood at ~63.57% as of Oct’23; representing moderate redemption pressure. The redemption pressure is on the lower side due to fixed maturity plan.
Plan X has invested 94.1% in GoP Ijara sukuk and ~1% in bank as of Oct'23. The WAM and duration of the Plan was 264 days at the end of Oct’23, exposing to high credit risk and interest rate risk. However, since the investment is in GoP Ijara Sukuk, the credit risk is at a manageable level. The top ten investor concentration stood at ~72.84% as of Oct’23; representing redemption pressure. The redemption pressure is on the lower side due to fixed maturity plan.
The Plan XI has invested ~97.7% of its assets in GoP Ijara sukuk and ~0.8% in bank as of Sep'23. The WAM and duration of the Plan was 335 days as of Oct’23, exposing to high credit and interest risk. However, since the investment is in GoP Ijara Sukuk, the credit risk is at a manageable level. The redemption pressure is on the lower side due to fixed maturity plan.
Going forward, any material changes in the Fund's asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk, would affect the rating.

About the Entity
MCB Investment Management Limited (MCBIM or the "Company") is a Public Listed Company, regulated by the SECP. MCBIM holds licenses for Asset Management, Investment Advisory, and Pension Fund Management. MCBIM caters to both conventional and Islamic clientele and is currently managing a diverse product slate of nineteen open-end funds and two voluntary pension schemes. MCBIM is also managing one of the largest AUMs under the SMA segment. The major shareholders of MCBIM are MCB Bank Limited ~81.42%, and Adamjee Insurance Company Limited ~7.59%. The general public holds the remaining ~11% of the shares. Mr. Khawaja Khalil Shah is the CEO of the company. There are four non-executive directors, three directors are independent and one CEO. The AUMs of MCBIM stood at PKR 155bln at end-Oct'23.