PACRA Maintains Asset Manager Rating of National Investment Trust Limited

National Investment Trust Limited (“NITL” or the “AMC”), Pakistan’s oldest asset management company, derives strategic advantage from its sovereign ownership, entrenched market position, and long operating history. Ratings are supported by a robust governance framework, a well-structured control environment, and oversight by an experienced board and committees governing audit, risk, strategy, and human resources. Investment and operational processes are codified through formal policies, disciplined compliance, and integrated risk management, complemented by information security protocols and operational continuity measures. During CY25, the mutual fund industry recorded moderate AUM growth of ~4% to PKR 4.5trln (CY24: PKR 4.3trln), with segment composition skewed towards money market (56%), income (24%), and equity (20%). Equity AUMs grew modestly due to favorable market performance and incremental inflows, while money market funds expanded by ~8%; income funds contracted by ~23%. NITL’s total AUMs declined by 4.5% to ~PKR 188.7bln (CY24: ~PKR 197.8bln), resulting in market share compression to 4.2% (CY24: 4.5%) while maintaining the 10th rank. Top-ten investor concentration increased to 43.4% (CY24: 39.7%), with institutional investors comprising 71% of total AUMs, reflecting considerable reliance on large institutional mandates.
Portfolio concentration remains significant, with the flagship National Investment Unit Trust (NIUT) accounting for ~51.5% of total AUMs and 38.3% of equity assets. Aggregate allocations are weighted towards equities (54%), followed by money market (36.7%) and income funds (7.4%), with the two largest funds representing 82.1% (CY24: 77.7%) of total AUMs. Fund performance was largely in line with benchmarks, though the NIT Government Bond Fund witnessed a decline in AUM of 78.9% to PKR 3.9bln (CY24: PKR 18.8bln), primarily driven by a shift in investor preference toward equity and Islamic money market funds amid evolving interest rate expectations. Equity fund AUM concentration limits portfolio agility, increasing sensitivity to market volatility and impacting relative performance rankings. From a financial perspective, 6MFY26 management fee income increased 71.5% to PKR 1,657mln (6MFY25: PKR 966mln; FY25: PKR 2,174mln), supporting profitability growth of 26.8% to PKR 1,819mln (6MFY25: PKR 1,435mln; FY25: PKR 1,759mln), primarily driven by robust fee income growth, along with contributions from unrealized gains and equity-accounted earnings. The equity base strengthened by 20.5% to PKR 22.5bln (FY25: PKR 18.2bln), providing a capital buffer equivalent to ~12% of AUMs and supporting operational leverage capacity. The AMC maintains a prudent balance sheet characterized by low leverage and adequate liquidity buffers, supporting financial stability across varying market conditions.
The rating remains contingent on NITL’s ability to sustain market position through disciplined investment frameworks, structured fund governance, and consistent risk-adjusted returns. Key rating considerations include AUM concentration risk, sensitivity to equity and interest rate volatility, operational continuity, and the ability to generate stable fee income while managing liquidity and redemption pressures across flagship funds.

About the Entity
NITL was established in 1962 and is a pioneer in the mutual fund industry. The AMC's Board currently comprises sixteen directors. Mr. Manzoor Ahmed assumed charge of the post of Managing Director (Acting), NITL on February 14, 2025. Being COO, he has been successfully managing the operations and investment portfolio worth over PKR 213bln. He has over 33 years of experience in the Mutual Fund industry and has been placed in many key positions within NIT. NITL is currently one of the largest Asset Management Companies in Pakistan with a portfolio of eleven open-end funds, which includes two non-public funds, namely NIT-SEF and NIT-EMOF, two voluntary pension schemes, two employee pension schemes, and an exchange-traded fund.