PACRA Upgrades Investment Advisor Rating of BMA Investment Advisors Limited (Formerly BMA Asset Management Company Limited)

The assigned rating of BMA Investment Advisors Limited (Formerly BMA Asset Management Company Limited) ("BMA-IA" or the "Company") takes into account the organizational structure changes, adequate governance framework, and good sponsor's profile. BMA IA has been serving investors since 2005 and manages significant portfolio in Pakistan. It also specializes in conventional and Shariah SMA products. Since Jun'22, the Company is acting purely in its capacity as an investment advisor. Portfolios managed by the Company pertaining to HNWI, corporate clients, and contribution funds. Total size of SMA market was PKR ~479bln. BMA IA as an SMA player in the market grabs ~9.4% of the market share at the end of Dec'23 compared to ~7.5% at the end of Jun'23, shows a reasonable growth in market share. The portfolios managed by the Company have shown sizeable growth of 45% in SMA's size from Jun'23 to Dec'23. From last rating upgrade BMA IA has added significant number of well reputed clients to its portfolio. The rating upgrade takes into account i) the growth over a short span which is attributable to the continued addition of new clients along with the increasing SMA of existing clientele and ii) the quality of reporting to clients which is considered strong with real-time NAVs available to the client's. The Shariah compliant portfolio comprise 26.7% and Conventional portfolio comprises 73.3% of total SMAs. While the top ten investor's concentration was standing at an average of ~85% during 6MFY24, comprising reputable investors. Fee-based revenues have depicted a sizeable increase on account of growth in SMAs accounts. Throughout the period, Separately managed accounts (SMAs) consistently deliver satisfactory portfolio returns. The financial performance of the Company has remained at a better level, generating adequate profitability during 6MFY24. The Equity of the Company stood at PKR ~52.2mln, the capitalization levels of the Company is considered sound as the Company has a sizeable cushion over the regulatory limit.
Going forward, the longevity and commitment of the investors under the SMA portfolio along with consistent performance track record and quality of of client servicing remain imperative for the assigned rating.

About the Entity
BMA Investment Advisors Limited (Formerly BMA Asset Management Company Limited) was incorporated in April 2005 and acquired the license for investment advisory and asset management in April 2005 and July 2005. The Company is a wholly-owned subsidiary of BMA Capital Management Limited, Mr. Mian Qasim Saeed Ahmed joined the Company as CEO in August 2020 and now he is currently working as President of the Company. The Company is now purely operating as an Investment advisor. The Company has a three-member board, all members are non-executive. Mr. Salim Khan is acting as the Chairman of the board since, October 2017. He possesses vast experience in strategic human resource consultancy and organizational development.