The Pakistan Credit Rating Agency Limited
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Muhammad Zain Ayaz

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PACRA Upgrades Asset Manager Rating of Pak Oman Asset Management Company Limited

Rating Type Asset Manager
(06-Aug-21 )
(15-Feb-21 )
Action Upgrade Maintain
AM Rating AM3++ AM3+
Outlook Stable Positive
Rating Watch - -

The rating recognizes Pak Oman Asset Management Company Limited's ("POAMCL" or the "Company") association with an established and renowned financial institution, Pak Oman Investment Company Limited. The financial risk profile of the AMC is supported by adequate capital structure, which bodes well for the rating. The rating reflects the Company's experienced management, structured investment decision making process and adequate governance framework. The AUMs of the Company has increased by ~47.3% since Jun'20 and stood at PKR 6.25bln at end Jun'21. While the market share remained stagnant at ~0.6%, the funds' performance of the AMC remained volatile except Askari High Yield Scheme and Askari Cash Fund which have beaten the industry averages. To enhance the assets under management, a number of initiatives are being taken including the expansion of sales force and ongoing focus on alternative distribution channels for enhanced retail market penetration. The fund slate of the Company is tilted more towards income and money market category. However, the Company is also planning to launch new funds in equity and income category. Furthermore, the launch of "Pak Oman Daily Dividend Fund" is under process which will further allow the Company's to penetrate in daily dividend category as well. The Company's equity stood at ~PKR 309mln at end Jun’21. These results is itself indication of efficiency of management and its commitment to bolstering bottom-line.
The rating assigned to the Company reflects the growing AUMs, diversifying fund slate, retail penetration and stable equity base. The rating is dependent on the Company’s ability to enhance its market position, gain in terms of assets under management and maintaining strong performance of its funds. Meanwhile, upholding high governance standards and strengthening of risk management is crucial for the rating.

About the Entity
Pak Oman Asset Management Company Limited was incorporated on July 28, 2006 as a public unlisted company. It is licensed by the Securities and Exchange Commission of Pakistan to carry out asset management and investment advisory services under the Non-Banking Finance Companies Regulations. The company is a majority owned subsidiary of Pak Oman Investment Company Limited (98%). The remaining shareholders include Oman International Development Company (0.84%), Bank Muscat (0.43%) and National Logistic Cell (0.84%).
The company’s Board of Directors comprise six members including the managing director of Pak Oman Investment Company, Mr. Bahauddin Khan. The board’s chairman H.H Juland Jaifer Salim Al-Said has over 15 years of experience at the Oman Investment Authority (OIA) (Previously known as State General Reserve Fund). The company’s diverse product slate includes eight open-end funds as at June'21 belonging to all major categories.

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.