The Pakistan Credit Rating Agency Limited
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PACRA Maintains Stability Rating of JS Cash Fund

Rating Type Stability Rating
(30-Oct-19 )
(30-Apr-19 )
Action Maintain Maintain
Long Term AA+(f) AA+(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

The rating reflects the strength of the fund's credit and interest risk profile. The fund's good credit quality and sound liquidity profile emanates primarily from its mandate to invest in government securities and other low duration avenues such as bank placement's and ensuring low exposure to interest rate risk. At end-Jun'19, 92% of fund's assets were allocated to bank placements, whereas 7% to commercial papers. Average duration of the fund remained within 45 days. Fund's unit holding pattern is highly concentrated with top 10 investors representing 83% of the net assets which exposes the fund to redemption pressure.
Going forward, the management of the fund intends to maintain it's current exposure in bank placement's and commercial papers. With the inversion of yield curve where 10 years PIB is yielding 11.25% and 6-month T-Bill yield is ~13.20%, a cut in policy rate is expected in short to medium term basis. The fund deviates quickly in different investment avenues incuding banks to exploit the yield curve movements for return generation.

About the Entity
JS Investments Limited was incorporated in 1995 and listed on the Pakistan Stock Exchange since April 24, 2007. It is one of the oldest private sector asset management company in Pakistan and rated AM2 by JCR. JS Bank Limited owns ~65% of JS Investments Limited. JS Bank Limited carries a long-term rating of 'AA-' and short-term rating of 'A1+' by PACRA. JS investments has a diversified fund slate consisting of twelve open-end funds and two voluntary pension funds. The assets under management were ~PKR 19.07 bln at end-Jun'19.

The board of JS Investment Limited comprises eight members including the Chief Executive Officer. The board comprises two independent directors, one executive, and 5 non-executive directors. The Chairman Mr. Kamran Jafar is the Deputy CEO of JS Bank Limited, a seasoned banker with twenty years of a proven track record in banking. In the year 2016, he joined as a member of the Board of Directors of JS Investments Limited. The CEO, Mr. Hasnain Raza Nensey has profound experience in the financial industry.

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.