The Pakistan Credit Rating Agency Limited
08-Sep-23
Analyst
Madiha Sohail
madiha.sohail@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of AKD Aggressive Income Fund
| Rating Type | Stability Rating | |
|
Current (08-Sep-23 ) |
Previous (08-Mar-23 ) |
|
| Action | Maintain | Maintain |
| Long Term | A+(f) | A+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
AKD Aggressive Income Fund ("AKD AIF" or the "Fund") reflects the Fund's medium-risk profile. The investment objective of the Fund is to offer investors a convenient vehicle to invest in a diversified portfolio of fixed income securities/instruments that provide consistent returns with concern for preservation of capital over the longer term. At the end of Jun'23, the exposure in T-Bills was ~32.64%, ~19.43% in TFCs/Sukuk, ~3.79% in Commercial Papers / Short Term Sukuk (STS), ~19.72% in Spread Transactions, and Cash was ~16.31%. The Fund remained compliant with the criteria of assigned rating; maximum 25% in A rated avenues. The WAM of the Fund stood at 183 days at the end of Jun'23; limiting the exposure to credit risk. The duration of the Fund was 64 days at the end of Jun’23, exposing the Fund to low interest rate risk. As of Jun'23, the unit holding pattern of the Fund was ~99.08% representing top ten investor concentration; exposing the Fund to high level of redemption pressure.
Going forward, the fund intends to maintain its exposure in government securities and maintain/increase allocation towards Sukuk/TFCs, given the avenues available for investing. Material changes in the fund's asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk, would affect its rating.
About
the Entity
AKD Investment Management Limited commenced its operations in September 2004. The Company is registered as an Asset Management Company under the Non-Banking Finance Companies Rules, 2003. The Company is sponsored by AKD Group Holdings (Private) Limited [Formerly: Aqeel Karim Dhedhi Securities(Private) Limited] (99.97% ownership). The Board of Directors of the Company comprises seven members, including the CEO Mr. Imran Motiwala, who has been serving as the Chief Executive Officer of AKD Investment Management Limited since 2009. The Company is currently managing eight open-end funds with assets under management of ~PKR 6.5bln at end of Jun'23.