The Pakistan Credit Rating Agency Limited
12-Nov-24
Analyst
Hassaan Ahmad
Hassaan.Ahmad@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Assigns Initial Stability Rating to Alhamra Government Securities Fund
| Rating Type | Stability Rating | |
|
Current (12-Nov-24 ) |
||
| Action | Initial | |
| Long Term | AA(f) | |
| Short Term | - | |
| Outlook | Stable | |
| Rating Watch | - | |
The Alhamra Government Securities Fund ("ALHGSF" or the "Fund") is a medium risk profile Fund. The objective of the Fund is to seek the maximum possible rate of return by investing primarily in Shariah-compliant Government Securities, Islamic Banks, and licensed Islamic Banking Windows of conventional banks. The Fund’s AUMs as of the end of Jul'24 were PKR 252mln. The Fund's credit quality is good and is in line with the assigned rating. As of the end of Jul'24, the Fund’s investment was ~86.3% in government securities/AAA-rated avenues, and ~9.9% in AA-rated avenues with the remaining invested in other avenues. At the end of Jul'24, most investments were held in GOP Ijarah Sukuk (~86.3%), followed by cash (~9.9%), with the remainder in other avenues. The WAM of the Fund stood at 631 days at the end of Jul'24, indicating high exposure to credit risk. The Duration of the Fund stood at 350 days at the end of July 2024, exposing the Fund to high interest rate risk.
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 rating.
About
the Entity
MCB Investment Management Limited (MCBIM or the "company") is a public listed company regulated by the SECP. MCBIM holds licenses for asset management, investment advisory, and pension fund management. MCBIM caters to both conventional and Shariah-compliant clientele and currently manages a diverse product slate of twenty-two open-end funds and four voluntary pension schemes. MCBIM also manages one of the largest AUMs in the SMA segment and holds a significant position in the investment advisory domain.
The major shareholders of MCBIM are MCB Bank Limited (~81.42%) and Adamjee Insurance Company Limited (~7.59%), with the general public holding the remaining ~11% of the shares. Mr. Khawaja Khalil Shah is the CEO of the company. There are four non-executive directors, three of whom are independent, and one executive director (CEO). The AUMs of MCBIM stood at PKR 231bln at the end of Jul'24.