Analyst
Hassaan Ahmad
Hassaan.Ahmad@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
PACRA Maintains Stability Rating of NBP Islamic Mahana Amdani Fund
Rating Type | Stability Rating | |
Current (09-Apr-24 ) |
Previous (13-Oct-23 ) |
|
Action | Maintain | Maintain |
Long Term | A+(f) | A+(f) |
Short Term | - | - |
Outlook | Stable | Stable |
Rating Watch | - | - |
NBP Islamic Mahana Amdani Fund is a moderate risk-profile fund. The investment objective of the Fund is to earn a reasonable rate of return in a Shariah compliant manner by investing in Shariah compliant debt securities, money market instruments and bank deposits. As of Dec'23, the Fund had invested in ~42% in GoP/Ijarah, ~32% in bank deposits, placements & other banking instruments in A category, ~8.3% in Corporate sukuks in AA category, ~7.9% in government backed securities and ~6.5% in certificate of musharaka. The duration of the Fund stood at 82 days at the end Dec’23, exposing moderate interest rate risk. The WAM of the Fund stood at 409 days at the end Dec’23, exposing high credit risk. The credit risk is high due to investment in long term sukuks and Govt securities. However, the investment in Govt Securities mitigate the overall credit risk. The unit holding pattern of the Fund was ~16.75% at the end Dec'23 representing top ten investor concentration, exposing a low level redemption pressure of the fund.
Going forward, any material changes in the investment policy and/or compliance with the rating criteria for the assigned rating would have an impact on the ratings.
About
the Entity
NBP Fund Management Limited (or the "Company"), established in 2005, is licensed by Securities and Exchange Commission (SECP) to carry out asset management and investment advisory business. National Bank of Pakistan is the largest shareholder of the company with a stake of ~54%. In 2019, Baltoro Growth Fund has acquired the entire 36% stake of Alexandra Fund Management Private Limited in the Company. Baltoro Capital is a Pakistan focused private equity firm. Baltoro Capital has made investments in the pharmaceutical, renewable energy and financial services sectors in Pakistan. It is actively deploying its funds in businesses positioned to achieve extraordinary growth. The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, CFA and family also holds a 10% stake in the company.
The Company’s nine-member Board of Directors includes three independent directors and the CEO. With overall assets under management of PKR ~268bln at end-Dec'23, the Company is currently managing a diversified fund slate of twenty five open-end mutual funds, two voluntary pension schemes and one Exchange Traded Fund.