The Pakistan Credit Rating Agency Limited
02-Jul-24
Analyst
Hassaan Ahmad
Hassaan.Ahmad@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of Alfalah Islamic Sovereign Fund
| Rating Type | Stability Rating | |
|
Current (02-Jul-24 ) |
Previous (28-Dec-23 ) |
|
| Action | Maintain | Initial |
| Long Term | AA+(f) | AA+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
Alfalah Islamic Sovereign Fund ("AISF" or the "Fund") is a low-risk profile Fund. The objective of the Fund is to provide income enhancement and competitive returns by investing in high/prime quality Financial Sector TFCs/ Sukuk, Spread Transactions, Bank Deposits and Money Market instruments. The AUMs of the Fund as of end Mar'24 was PKR 4,223mln. The Fund had strong credit quality at end-Mar'24, keeping ~84% in AAA rated category and ~6% in AA rated avenues. At the end of Mar’24, the Fund had allocated ~83% in GOP Ijara sukuk, ~5% in banks in the form of deposits and placements and the remaining was invested in others. The WAM of the Fund was 851 days at the end of Mar'24, representing high exposure to credit risk. The Duration of the Fund stood at 62 days at end-Mar'24; representing moderate exposure to interest rate risk. The top 10 investors' concentration of the Fund at end-Mar'24 was ~45.37%, exposing the Fund to a moderate level of redemption pressure.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the ratings.
About
the Entity
Alfalah Asset Management Limited (Formerly: Alfalah GHP Investment Management Limited) was incorporated on October 18, 2004 as an unlisted public limited company and is licensed by the Securities and Exchange Commission of Pakistan to manage open-ended mutual funds and offer investment advisory services. The Company was established as joint venture Non-Banking Finance Company by Bank Alfalah Limited and GHP Arbitrium. The Company provides a wide range of mutual funds and pension funds both in conventional and Shariah compliant category. The Company also provides investment advisory services to HNW individuals and corporate clients.
The Company’s board of directors comprises eight members including the Chairman and the Chief Executive Officer. The board is dominated by representatives of MAB Investments and Bank Alfalah Limited. The board has two independent and five non-executive directors. The board members possess strong profile and skills suited to the financial services industry. Assets under management of the Company stood at ~PKR 158.65bln at end Mar'24.