PACRA Maintains the Stability Rating of Alhamra Government Securities Fund

Alhamra Government Securities Fund ("ALHGSP-I" or "the Fund") is categorized under a medium-risk Islamic Income Scheme, with the objective of seeking the maximum possible rate of return through investments primarily in Shariah-compliant Government Securities, Islamic Banks, and licensed Islamic Banking Windows of Conventional Banks. The Fund is designed for investors seeking competitive income generation through sovereign-backed Islamic instruments with longer-duration fixed income investments. As of Mar'26, the Fund's Assets Under Management (AUM) stood at PKR 442mln, compared to PKR 761mln as of Sep'25 (the last review), reflecting a contraction in fund size during the review period amid changing investor preferences and prevailing market conditions. In terms of asset allocation, approximately 86% of the portfolio was invested in GoP Ijarah Sukuks, while ~7% was maintained in cash and cash equivalents, with the remaining ~7% represented by other receivables. The portfolio remained heavily concentrated in sovereign-backed Shariah-compliant instruments, reflecting the Fund's mandate and providing a strong foundation from a credit quality perspective. From a credit quality standpoint, approximately 88% of the Fund's assets were invested in AAA-rated instruments, while ~5% was allocated to AA-rated avenues. The Fund's overall credit profile remains strong, supported by its substantial exposure to highly rated sovereign-backed instruments and quality counterparties. The portfolio's credit risk remains well contained despite the Fund's medium-risk classification, as the majority of investments continue to be concentrated in top-tier exposures. The Fund's Weighted Average Maturity (WAM) stood at 730 days as of Mar'26. The elevated maturity profile reflects relatively high sensitivity to changes in profit rates and market valuations, primarily driven by the Fund's significant allocation to longer-tenor GoP Ijarah Sukuks. While the longer duration may expose the portfolio to mark-to-market volatility during periods of interest rate fluctuations, it also provides the potential to benefit from favorable movements in the profit rate environment over the investment horizon. In terms of performance, the Fund generated a 365-day return of 8.90% as of Mar'26 against its benchmark return of 10.18%. The relative underperformance was primarily attributable to valuation adjustments associated with longer-duration sovereign instruments amid evolving market yield dynamics. Nevertheless, the Fund's investment strategy remains consistent with its mandate and continues to emphasize high-quality sovereign Islamic securities.
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) is a public listed company. It holds licenses for asset management, investment advisory, and pension fund management, catering to both Conventional and Shariah investment solutions. MCBIM manages a diversified portfolio, including 26 Open-End Mutual Funds and 4 Voluntary Pension Schemes, while also maintaining a leading position in Separately Managed Accounts (SMA) and investment advisory services. MCBIM’s major shareholders include MCB Bank Limited (~81.42%), Adamjee Insurance Company Limited (~7.59%), and the general public (~9.28%). Mr. Khawaja Khalil Shah serves as the Chief Executive Officer of the company. The Board comprises a balanced composition of 4 Non-Executive Directors and 3 Independent Directors, ensuring strong governance, objective decision-making, and alignment with regulatory best practices. The Company’s assets under management (AUM) have grown significantly, reaching approximately PKR 535 Billion as of Apr'26, reflecting its strong market presence and consistent growth in Pakistan’s asset management industry.