The Pakistan Credit Rating Agency Limited
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Wajeeha Asghar

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PACRA Maintains Stability Rating of Atlas Sovereign Fund

Rating Type Stability Rating
(14-Oct-22 )
(15-Apr-22 )
Action Maintain Maintain
Long Term AA-(f) AA-(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

Atlas Sovereign Fund (or the "Fund") reflects the fund's medium risk profile. The assigned rating reflects the Fund's moderate credit and interest rate risk profile emanating from its investment strategy. The Fund had allocated ~3.2% in Corporate Sukuks, ~4.5% in banks rated AA+, ~20.2% in CPs, ~33.2% in PIBs. Whereas, ~38.4% in T-Bills, in the end Jun'22. The duration of the Fund stood at 128 days in the end Jun'22 (Dec’21: 263 days), exposing Fund to moderate interest rate risk. While the WAM of Fund stood at 493 days in the end Jun-22 (Dec’21: 551 days), exposing the Fund to moderate credit risk. However, since the investment in long term Govt papers, the credit risk is manageable. The Fund remained compliant with the rating criteria for the assigned ratings. The unit holding pattern of the Fund were ~98.81% representing top ten investor concentration of which ~74.51% was related party holding, keeping low level of redemption pressure.
Going forward, the material changes in the Fund's asset allocation strategy, impacting its credit quality and/or average duration, would affect the rating.

About the Entity
Atlas Asset Management Limited, incorporated in August 2002 and a part of Atlas Group, is a wholly owned (100%) subsidiary of Shirazi Investments (Pvt.) Limited - the holding company of the Group. Atlas Group, established in 1962, is one of the well-known business groups of the Country with a presence in manufacturing, financial, and trading sectors.
AAML's seven-member board of directors comprises four representatives of Atlas Group, two independent directors and the CEO. The CEO of the Company, Mr. Muhammad Abdul Samad, has completed the Advanced Management Program from INSEAD and holds postgraduate qualifications from the University of Karachi and the Southeastern University, he also holds certification from IFMP. He has been associated with the Company for over seventeen years and held C-Suite positions for over a decade. He has a significant Board experience, where he has served as a director on the board of nineteen listed companies, including Atlas Battery Limited, Lucky Cement, Berger Paints, Mirpurkhas Sugar, amongst others along with vast experience of the mutual fund industry. The Company is currently managing five conventional and five shariah compliant funds, along with two in the VPS category. The assets under management stood at ~PKR 45bln at end Jun'22

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.