The Pakistan Credit Rating Agency Limited
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Muhammad Zain Ayaz

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PACRA Assigns Positive Outlook to Asset Manager Rating of PAK Oman Asset Management Company Limited

Rating Type Asset Manager
(11-Mar-22 )
(06-Aug-21 )
Action Maintain Upgrade
AM Rating AM3++ AM3++
Outlook Positive Stable
Rating Watch - -

The rating recognizes Pak Oman Asset Management Company Limited's ("POAMCL" or the "Company") association with an established and renowned financial institution, Pak Oman Investment Company Limited. The rating reflects the Company's experienced management, structured investment decision making process and adequate governance framework. Over the past few years, the AUMs of the Company have shown a significant growth of ~79%, since Jun’19. Currently, the AUMs are standing at PKR ~8bln, while the average market share remained 0.8%, at Dec’21. The Company is eying to boost its market share in rapidly growing market. The overall, fund performance of the Company remained above the benchmark except for asset allocation category which underperformed and has limited size. The Company has also improved its cost control measures and has also posted a steady growth in revenue leading to reduction in accumulated losses. To enhance the assets under management, a number of initiatives are being taken including the expansion of sales force and ongoing focus on alternative distribution channels for enhanced retail market penetration. In order to strengthen its position, in the industry, the Company is also diversifying its product slate and currently launched a new fund in Islamic daily dividend category. The financial risk profile of the AMC is supported by adequate capital structure,
which bodes well for the rating.
Change in outlook assigned to the Company, reflects the growing AUMs, diversifying fund slate, retail penetration and sponsor’s commitment to support equity base. The rating is dependent on the Company’s ability to enhance its market position, gain in terms of assets under management and maintaining strong performance of its funds. Meanwhile, upholding high governance standards and strengthening of risk management is crucial for the rating.

About the Entity
Pak Oman Asset Management Company Limited was incorporated on July 28, 2006 as a public unlisted company. It is licensed by the Securities and Exchange Commission of Pakistan to carry out asset management and investment advisory services under the Non-Banking Finance Companies Regulations. The company is a majority owned subsidiary of Pak Oman Investment Company Limited (98%). The remaining shareholders include Oman International Development Company (0.84%) and Bank Muscat (0.43%). The company’s Board of Directors comprise six members including the managing director of Pak Oman Investment Company, Mr. Bahauddin Khan. The board’s chairman H.H Juland Jaifer Salim Al-Said has over 15 years of experience at the Oman Investment Authority (OIA) (Previously known as State General Reserve Fund). The company’s diverse product slate includes nine open-ended funds as at Dec'21 belonging to all major categories.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.