PACRA Upgrades the Asset Manager Rating of Lucky Investments Limited

The assigned rating of Lucky Investments Limited ("Lucky Investments" or "the AMC") reflects its growing position as a fully Shariah-compliant asset management company, supported by the financial strength and institutional profile of the YBG Group. Having commenced operations in Dec'24, the AMC has, within a relatively short operating history of approximately 1.5 years, established a meaningful presence in the rapidly growing Islamic asset management segment, reflecting effective execution of its business strategy. The AMC benefits from established relationships across the corporate, financial, and YBG Group ecosystem, providing a strong distribution platform. The sponsors continue to provide strategic oversight through an effective governance framework, while the experienced management team, comprising seasoned professionals with established market credentials and a proven track record in the asset management industry, supports the execution of the AMC's strategic objectives. The AMC has also demonstrated its ability to develop a diversified Shariah-compliant product suite, complemented by strengthening digital capabilities and a sound compliance framework.
As of the latest reporting period, the AUMs stood at ~PKR 126bln, representing ~3% of the overall asset management industry and ~6% of the Islamic asset management segment. The AUM remains primarily concentrated in the Lucky Islamic Money Market Fund, followed by the Lucky Islamic Income Fund. Overall, the fund performance remained in line with the industry averages. During the period, the AMC launched its first Islamic Pension Fund, which is expected to benefit from potential participation by YBG Group employees, corporate retirement funds, and government pension schemes. Furthermore, the AMC has established a distribution platform through which investors can access Collective Investment Schemes (CIS) managed by other asset management companies, providing an additional source of distribution fee income while broadening the range of investment solutions offered to investors. The AMC is also progressing the launch of Pakistan's first ESG-focused fund and a Capital Protected Fund, while pursuing an RMC license to establish a REIT Fund, reflecting its continued focus on product diversification. The investor base remains largely concentrated in institutional and high-net-worth investors, with comparatively lower retail participation. To broaden its retail footprint, management has undertaken initiatives including the operationalization of its Lahore office and planned expansion into Islamabad, Peshawar, and Karachi. The AMC has also established secure API-based integrations with fintechs, Electronic Money Institutions (EMIs), and other digital ecosystem partners, enabling seamless digital onboarding, payments, fund transfers, and value-added services. These initiatives have supported an increase in retail participation, with retail investors now accounting for ~22% of the investor base. Financial performance has strengthened, with profit after tax increasing to PKR 226mln by FY26, primarily driven by higher fee and commission income. The improvement in profitability has correspondingly strengthened the AMC's equity base, supporting its overall financial profile.
The rating is dependent upon the AMC's ability to sustain growth in its AUM base, strengthen its market position, maintain competitive fund performance, and execute its branch expansion and distribution strategy. Further diversification of the investor base through improved retail penetration, supported by digital channels and strategic distribution partnerships, while sustaining profitability, remains important.

About the Entity
Lucky Investments Limited is licensed by the Securities and Exchange Commission of Pakistan (SECP) as a Non-Banking Finance Company (NBFC) to undertake asset management, voluntary pension fund management, and investment advisory services, enabling the AMC to offer a diversified range of investment solutions. Currently, the AMC is owned (70%) by YB Pakistan, while the remaining 30% is held by Mr.Muhammad Shoaib, CFA, who is a seasoned professional with over 36 years of capital market experience. The seven-member Board of the AMC is chaired by Mr. Muhammad Ali Tabba, who is well-known in the market for his towering successes as an entrepreneur and businessman.