The Pakistan Credit Rating Agency Limited
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Wajeeha Asghar

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PACRA Maintains Stability Rating of "Pak Qatar Khalis Bachat Plan" under Pak Qatar Islamic Income Fund

Rating Type Stability Rating
(02-Jun-23 )
(02-Dec-22 )
Action Maintain Initial
Long Term A(f) A(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

Pak Qatar Islamic Income Fund (or the "Fund") is an open-ended shariah compliant Income fund. The Fund falls under medium risk profile. The objective of the Fund is to maximize the investor's return by investing in shriah-compliant authorized investable avenues. The undermentioned plans are initially offered under the umbrella of the Fund i) Pak-Qatar Monthly Income Plan ii) Pak-Qatar Monthly Income Plan and iii) Pak-Qatar Khalis Bachat Plan. Subsequently, additional plans may also be launched.
Pak Qatar Khalis Bachat Plan (PQKBP or the 'Plan') focus on Takaful benefits who prefer yearly dividend under a stable Income category. The objective to generate superior, long-term, risk-adjusted returns in accordance with Shariah practices The term of the Plan is perpetual. As per the investment policy of the Plan, the Plan can't invest in below single A- rated avenues. While as for as asset allocation is concerned, the Plan can invest up to 100% in shariah-compliant Govt. securities and cash at Bank. The Plan may change the dividend frequency at its own discretion for the benefit of the unit holder with prior intimation.
Currently, the Plan had invested ~35.4% cash in banks majority rated single A, ~54% in Corporate Sukuks and FIs Sukuks rated A and above. Whereas, ~7.4% in 5 year GoP Ijarah Sukuk at the end Mar’23. The duration of the Plan stood at 37 days at the end Mar’23, exposing low interest rate risk whereas the WAM of the Plan stood at 832 days at the end Mar’23, exposing high credit risk. The Credit risk is high due to investment in GoP Ijarah Sukuks. The unit holding pattern of the Plan stood at 97.5% concentrated out of which 94.6% is of related party holding, limiting redemption pressure.
Going forward, the plan ensures to diversify their investment in A- and above rated avenues. Any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the rating.

About the Entity
Pak Qatar Asset Management Company Limited (PQAMC) was formed in 2021 offering Shariah Compliant Investment solutions and is part of Pak-Qatar Group, a pioneer in Takaful Industry in Pakistan. The Group comprise of Pak Qatar Family Takaful Limited(PQFTL), Pak-Qatar General Takaful Limited(PQGTL), Pak Qatar Investment (Pvt) Limited(PQIL), Sharq Trading & Merchandising Limited, MPQ Developers (Pvt) Limited. The group has been operating in Pakistan since 2007 has diverse experience of over fifteen years in providing takaful solutions in Pakistan. The CEO, Mr. Farhan Shaukat, FCA, has been associated with the group for over a decade heading Treasury function of the group. The company has launched three funds under Money Market, Income and Equity category under plan arrangement. AUM of the company stood at ~PKR 6.4bln at the end Mar'23

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