The Pakistan Credit Rating Agency Limited
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Madiha Sohail

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PACRA Maintains Stability Rating of Alfalah GHP Cash Fund

Rating Type Stability Rating
(28-Sep-23 )
(29-Mar-23 )
Action Maintain Maintain
Long Term AA+(f) AA+(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

Alfalah GHP Cash Fund (or the "Fund") is low risk profile fund. The objective of Fund is to provide regular stream of income at competitive rate of return while preserving capital to the extent possible by investing in assets with low risk and high degree of liquidity from a portfolio constituted mostly of money market securities and placements. The Fund's good credit quality and sound liquidity profile emanate primarily from its mandate to invest in Government Securities and in bank deposits. At end June'23, the Fund had allocated ~40.09% in T Bills, ~50.25% in Bank deposits, placements & other banking instruments in AA+ rated and above, ~9.66% in Corporate short term sukuks majorly in AA rated. The WAM stood at 39 days. While the duration stood at 26 days at end Jun’23. The WAM and Duration falls within the specified range for the assigned rating thus minimizing the exposure to Interest rate risk, Credit risk and Liquidity risk. The unit holding pattern of the Fund was ~58.48% representing top ten investor concentration; exposing the Fund to moderate level of redemption pressure which is manageable on the back of strong liquidity profile.
Going forward, the Fund intends to maintain the current allocation strategy. Material changes in the Fund's asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk, would affect the rating.

About the Entity
Alfalah Asset Management Limited (Formerly: Alfalah GHP Investment Management Limited) was incorporated on October 18, 2004 as an unlisted public limited company and is licensed by the Securities and Exchange Commission of Pakistan to manage open-ended mutual funds and offer investment advisory services. The Company was established as joint venture Non-Banking Finance Company by Bank Alfalah Limited and GHP Arbitrium. The Company provides a wide range of mutual funds and pension funds both in conventional and Shariah compliant category. The Company also provides investment advisory services to HNW individuals and corporate clients.
The Company’s board of directors comprises eight members including the Chairman and the Chief Executive Officer. The board is dominated by representatives of MAB Investments and Bank Alfalah Limited. The board has two independent and five non-executive directors. The board members possess strong profile and skills suited to the financial services industry. Assets under management of the Company stood at ~PKR 99.4bln at end June'23.

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.