The Pakistan Credit Rating Agency Limited
24-Dec-24
Analyst
Hassaan Ahmad
Hassaan.Ahmad@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of ABL Government Securities Fund
| Rating Type | Stability Rating | |
|
Current (24-Dec-24 ) |
Previous (17-May-24 ) |
|
| Action | Maintain | Maintain |
| Long Term | AA-(f) | AA-(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
ABL Government Securities Fund (or the "Fund") is a low risk profile Fund. The objective of the scheme is to deliver optimal risk adjusted returns by investing mainly in mix of short to long term Government Securities and other debt Instruments. At end-Jun'24, the Fund had allocated ~69.4% of net assets in PIBs, ~15.4 in T-Bills, ~9.4% in bank placement, ~2.3% in TFCs/Sukuks, ~0.9% in Government backed securities while the remaining ~2.6% was invested in other avenues. At end Jun'24, most of the investments was held in Govt.Sec/AAA rated avenues (87.9%), ~7.74% in AA-, ~1.8% in A+ rated, while the remaining was invested in other rated avenues. At end Jun'24, the duration of the Fund stood at 1 day, limiting the exposure to interest rate risk. The WAM of the Fund stood at 706 days due to investments in long-term securities. A high value of WAM usually denotes very high credit risk; however, since the majority of the Fund's allocation pertains to long-term government securities, credit risk is negligible. At end Jun'24, the unit holding pattern of the Fund stood at 6.88%, representing top 10 investors concentration, exposing the Fund to very low level of redemption pressure.
Going forward, any material changes in the investment policy and compliance with the rating criteria for the assigned rating would have an impact on the ratings.
About
the Entity
Incorporated in 2007, ABL AMC is a wholly owned subsidiary of Allied Bank Limited (ABL). ABL operates with 1,400 plus branches including 117 Islamic banking branches, 8 Digital/ Self Service branches & 2 overseas branches. ABL AMC possesses licenses for asset management, pension management and investment advisory services. As the leading private sector asset management and investment advisory Company in Pakistan, offerings include a comprehensive range of both Conventional and Shariah Compliant investment solutions across all major asset classes. Assets under management of the Company stood at ~PKR 199.8bln at the end of Jun'24.