PACRA Maintains Asset Manager Rating of National Investment Trust Limited
|Rating Type||Asset Manager|
National Investment Trust Limited ("NITL" or the "Company") is the oldest AMC which reaps the benefit of being the first AMC in Pakistan. The rating incorporates fund slate diversification, structured decision-making process and experienced management team. The rating also takes comfort from strong control environment and satisfactory governance framework. Given the sponsorship of the Government of Pakistan, the business acumen of the Company is considered strong. Also, the strong equity base and financial profile of the Company bodes well to the rating. Previously NITL managing Separately Managed Account (SMA) non-discretionary portfolio of single entity amounting to ~PKR 77bln at end-Sep’22. However, the SMA are now matured at the end Dec'22. NITL is focusing to capture market share under IAs and focusing on the arrangements with prominent entities to provide investment advisory services under SMA. Currently the market share of NITL including private mix fund (NIT-SEF & NIT-EMOF) as of Dec’22 stood at 6.1% (Dec’21: 8.3%). The AUMs of the Company slightly decreased by ~0.6% to stand at PKR 95.4bln at end Dec’22 (Jun’22: PKR 96bln). A slight decrease in AUMs of NITL is attributed to NITL’s signature equity fund National Investment Unit Trust (NIUT) with a weight of ~54% in overall AUMs. The decrease in AUMs of NIUT Fund was primarily due to stock market performance. The market capitalization decline by ~15.5% from Dec’21 to Dec’22. However, the market's inclination is towards less riskier funds like Money Market and Income funds. The growth in NIT Money market Fund is volatile as of Dec'22 and Mar'23 as compared to Jun'22 with reason being redemption trends after CY closure. The overall fund's performance remained satisfactory with majority of the funds performing better and beating the industry average as at Dec’22. The NIT Social Impact Fund under microfinance income category has also outperformed the industry average. The AUMs of NIT Social Impact Fund increased by 44% to PKR 1,280mln at the end Mar'23 (Jun’22: PKR 735mln). On Financial side, the net loss of the Company decreased to ~22% to PKR -163mln at the end Dec’22 (SPLY: loss PKR -211mln) due to un realized loss on re-measurement of investment. The total equity of the Company is reported at PKR 10.1bln at the end Dec'22.
The rating is dependent upon the Company’s ability to sustain its market share and upholding strong investment processes and control environment. Meanwhile, consistent performance of funds compared to benchmark and peers is critical. Any sustained downturn in fund performance and/or significant loss in market share may impact the rating.
National Investment Trust Limited was established in 1962 and is a pioneer in mutual fund industry. The Company’s Board of Directors currently comprises eleven board members out of which ten are non-executive. Mr. Adnan Afridi, CEO/MD who joined in Feb'19 holds profound experience in the financial services and capital markets. Mr. Manzoor Ahmed is the COO and has a successful track record of managing the operations and investment portfolio of the Company. The Company is currently one of the largest asset management company in Pakistan with a portfolio of fourteen open-end funds which includes two non-public funds namely NIT-SEF and NIT-EMOF, two voluntary pension schemes and an exchange traded fund. The AUMs of the Company stood at 95.4bln at the end Dec'22.