The Pakistan Credit Rating Agency Limited
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Madiha Sohail

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PACRA Maintains Stability Rating of Atlas Income Fund

Rating Type Stability Rating
(17-Apr-23 )
(14-Oct-22 )
Action Maintain Maintain
Long Term AA-(f) AA-(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

Atlas Income Fund ("AIF" or the "Fund") reflects the fund's moderate risk profile. The investment objective of the Fund is to earn a competitive return while preserving capital by investing in good quality corporate debt instruments, bank deposits and government securities. The assigned rating reflects the Fund's moderate credit and interest rate risk profile emanating from its investment strategy. The Fund had allocated ~66.57% in T Bills, ~14.34% in PIBs, ~11.86% in TFC/Sukuk, ~2.93% in Cash, ~1.99% in CPs, ~1.55% in MTS while remaining was invested in Others. Due to investment in longer-term PIBs and TFCs. The WAM of the Fund stood at 583 days at the end Dec'22, exposing the Fund to the high level of credit risk and mark-to market losses. The duration of the Fund increased to 125 days at end Dec'22, exposing the Fund to interest rate 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 concentration were ~90.88% represented by top ten investors, keeping high 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 49bln at end Dec'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.