The Pakistan Credit Rating Agency Limited
26-Dec-19
Analyst
Madiha Sohail
madiha.sohail@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Asset Manager Rating of Atlas Asset Management Limited
| Rating Type | Asset Manager | |
|
Current (26-Dec-19 ) |
Previous (28-Jun-19 ) |
|
| Action | Maintain | Maintain |
| AM Rating | AM2+ | AM2+ |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
The rating incorporates the Company’s strong governance structure, accomplished management team, structured investment process and stable market share. The rating incorporates the Company's association with a renowned business group, Atlas group. The overall AUMs of the Company reduced resulting in slight dip in market share to ~4.5% (~5.0% at end Dec-18). However, the Company managed to somewhat maintain its AUM's in the equity category, despite outflows witnessed in the industry. The fund performance remained adequate when compared to peers. The management introduced 4 plans under Shariah-Compliant Fund of Funds during FY19. The Company acquired an advisory licence from SECP in FY19, to further diversify the revenue stream. The Company has a modest standing in the retail avenue and intends to strengthen its sales team to provide impetus in augmenting retail penetration.
The rating is dependent on upholding strong governance and organizational structure. Meanwhile, increasing market share and customer outreach along with consistent fund performance remains imperative.
About
the Entity
Atlas Asset Management Limited, incorporated in August 2002, is a wholly owned subsidiary of Shirazi Investments (Pvt.) Limited – the holding company of Atlas Group. Atlas Group, founded in 1962 with the establishment of Shirazi Investments, is a diversified group having presence in manufacturing, power, financial services, and trading. It consists of four companies listed on the Stock Exchange in Pakistan and a number of non-listed companies. The Company’s seven-member Board of Directors comprises five representatives of Atlas Group including the CEO, the other two are independent directors. Mr. Iftikhar H. Shirazi was appointed in the Board of Directors in Nov-19, after the demise of Mr. Yusuf H. Shirazi. Mr. Iftikhar H. Shirazi is currently Chairman of Shirazi Investments (Pvt) Limited. The board has three sub-committees for providing oversight on the Company’s affairs: 1) Audit Committee, 2) Human Resource & Remuneration Committee and 3) Investment Committee.