PACRA Maintains Stability Rating of Pak Oman Advantage Islamic Income Fund
|Rating Type||Stability Rating|
Pak Oman Advantage Islamic Income (or the "Fund") is a moderate risk profile Fund. The credit quality of the Fund was ~52.46% in single A- rated avenues, ~11.8% in double AA rated avenues whereas ~7.8% in triple AAA rated avenues and ~0.14% in single A+ rated avenues. The Fund had allocated ~53.1% in banks majority in single bank rated A- whereas ~11.9% in corporate sukuks rated AA and above, ~6.7% in GoP Ijarah Sukuks at the end Dec’22. However, In Jan'23 the Fund had invested ~71.69% in banks majority in single bank rated A, ~10.9% in TFCs and ~5.38% in GoP Ijarah Sukuks. The duration of the Fund stood at 117 days at end Dec'22 (Jun'22: 187 days), exposing moderate interest rate risk whereas the WAM of the Fund stood at 289 days at the end Dec’22 (Jun'22: 274 days), exposing moderate credit risk. However, credit risk is manageable due to investment in Govt securities. The unit holding pattern of the Fund is highly concentrated where ~93.4% is represented by top 10 investors. However, ~31.01% is of related party holding, keeping redemption pressure at moderate level.
Going forward, the Fund compliance with the assigned rating criteria would strictly watched. Any non compliance if reported, would result in revision of rating action. 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.
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 comprises 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 end funds as at Dec'22 belonging to all major categories. The AUMs of the Company stood at~9.3bln in the Dec'22.