PACRA Maintains Asset Manager Rating of National Investment Trust Limited
|Rating Type||Asset Manager|
National Investment Trust Limited ("NITL" or the "Company") is one of the prominent and oldest AMC which reaps the benefit of being the first AMC in Pakistan. The rating incorporates fund slate diversification, Structured decision making process and experienced management team. The rating also takes comfort from Strong Control Environment and Satisfactory Governance Framework. Strong equity base and financial profile of the Company bodes well to the rating. The Compliance, Risk Management and Internal Audit functions are segregated in line with the best practices to strengthen the control environment. The AUMs of the Company has slightly declined by~3% to ~PKR 96bln at end-Dec’21 (Jun’21: PKR 99bln) majorly due to decline in Fund size of NITL Equity Fund as the market gave negative returns during the period ending on Dec'21. NITL Equity Fund carries~80% weight of the total Fund size of the Company. However, lately in Mar'22, the Company has managed to recover its AUMs and reported AUMs at PKR~100.57bln at the end Mar'22. The market share in terms of CIS of the Company has been declined to 8.3% (Jun'21:8.6%) given the volatility in the stock market. The fund's performance remained satisfactory with majority of the funds performing better and beating the benchmarks as at Dec'21. The growth momentum is expected with management focusing on strengthening its digital presence and outreach which would ultimately results in better retail penetration and distribution & customer services. Meanwhile, a materialization of digital initiatives would remain imperative. NITL's top ten investors owned 32%, NIUT comprises of majority of the Company's investors base, 68% of investors are concentrated in NIUT. NITL is also focusing to capture market share under IAs and has recently entered into arrangements with prominent entities to provide investment advisory services under SMA. The AMC has also expanded its Funds family by launching Pakistan First Social Impact Fund on 16th May'22, it's an open end Micro Finance Sector Income Fund Scheme that shall channelize funds of impact investors to leverage on the strengths of rated asset pool of Micro Finance sector. The overall funds performance remained satisfactory where majority of the funds outperformed the industry averages and benchmark. NITL remained profitable in 3QFY22 and posted highest profits in industry and has the largest equity base at end-Dec'21. NITL's capitalization and fee generation capabilities provides cushion against market volatility.
The rating is dependent upon the Company’s ability to sustain its market share and upholding strong investment processes and control environment. Meanwhile, consistent performance of funds compared to benchmark and peers is critical. Any sustained downturn in fund performance and/or significant loss in market share may impact the rating.
National Investment Trust Limited was established in 1962 and is a pioneer in mutual fund industry. The Company’s Board of Directors currently comprises eleven board members out of which ten are non-executive. Mr. Adnan Afridi, CEO/MD who joined in Feb'19 holds profound experience in the financial services and capital markets. Mr. Manzoor Ahmed is the COO and has a successful track record of managing the operations and investment portfolio of the Company. The Company is currently one of the largest asset management company in Pakistan with a portfolio of fourteen open-end funds which includes two non-public funds namely NIT-SEF and NIT-EMOF, two voluntary pension schemes and an exchange traded fund.