The Pakistan Credit Rating Agency Limited
30-Apr-19
Analyst
Ayesha Qasim
ayesha.qasim@pacra.com
+92-42-35869504
www.pacra.com
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Related Research
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PACRA Maintains Stability Rating of JS Cash Fund
| Rating Type | Stability Rating | |
|
Current (30-Apr-19 ) |
Previous (06-Dec-18 ) |
|
| Action | Maintain | Maintain |
| Long Term | AA+(f) | AA+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
JS Cash Fund (JS CF) is an open-end 'Money Market Scheme' that mainly invests in low risk short-term fixed income instruments including money market instruments to provide a regular and reasonable return to investors while ensuring high liquidity. The Fund shall invest primarily in short duration instruments and may even hold some or all of its assets in cash for the purpose maintaining liquidity.
The rating reflects the fund's low risk profile emanating from sizable allocation of assets towards highly liquid, low credit risk avenues. At end Dec-18, the portfolio comprised cash balances (84.6%) with majority of exposure in AA rated banks (75%) and with AAA rated banks (~18%). Average duration of the fund at end Dec-18 stood at 5 days; maximum duration at a quarter end during CY18 was 7 days. The unit holding pattern of the fund is highly concentrated with the top ten investors representing around 81% of portfolio (owned investments ~8.4%).
Going forward, the fund intends to maintain investing strategy towards high liquidity and low credit risk mainly in form of AA and above rated banks and government securities. Material changes in the fund's asset allocation strategy, which could negatively impact the fund's credit quality and exposure to interest rate risk, remains critical for the rating.
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 eleven open-end funds and two voluntary pension funds. The AUMs were ~PKR 19.9bln at end Mar-19.
The board of JS Investment Limited comprises eight members including the Chief Executive Officer. The board has one independent director, four sponsor representatives and two group representatives. The Chairman Mr. Basir Shamsie is a part of the JS Group since 1994 and is the Chairman of JS Investments Limited since 2016. The CEO, Mr. Hasnain Raza Nensey has profound experience in the financial industry.