Analyst
Mohsin Naseer
mohsin.naseer@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
PACRA Maintains Stability Rating of Atlas Income Fund
Rating Type | Stability Rating | |
Current (12-Jul-17 ) |
Previous (09-Dec-16 ) |
|
Action | Maintain | Maintain |
Long Term | AA-(f) | AA-(f) |
Short Term | - | - |
Outlook | Stable | Stable |
Rating Watch | - | - |
The rating reflects the fund's low exposure to interest rate volatility, strong credit profile, and diversification across assets. At end-May’17, fund's exposure with Government securities was 60% (T-Bills, 59.1%; PIBs, 1.2%), while 3% exposure was as cash in banks rated AA-. Exposure with good quality TFCs was 17.3% with rating of 'AAA' and 'AA-'. The remaining assets of the fund were exposed with MTS transactions (i.e. 13.7%), which due to its self-liquidating nature possess less risk over short term. The unit holding pattern of the fund shows redemption pressure over the fund as top10 investors represents 89% of fund assets.
Going forward, the fund intends to keep its exposure levels as per above criteria. Material changes in the fund's asset allocation strategy, which could negatively impact the fund's credit quality and exposure to interest rate risk, remain critical for the rating.
About
the Entity
Atlas Asset Management Limited (AAML), incorporated in August 2002 and a part of Atlas Group (AG), is a wholly owned (100%) subsidiary of Shirazi Investments (Pvt.) Limited (SIL) - the holding company of the Group. Atlas Group, established in 1962, is one of the well-known business groups of the country with presence in manufacturing, financial, and trading sectors. With an AUM base of PKR 32.3bln at May-17, AAML is currently managing seven open end funds; along with conventional and Islamic Pension Funds.
AAML's seven-member board of directors comprises four representatives of Atlas Group, two independent directors and the CEO. The Vice-Chairman & CEO of AAML, Mr. M. Habib-ur-Rahman is a veteran of the mutual fund industry. He has been associated with the company since 2004. Mr. M. Abdul Samad, Chief Operating Officer, has over sixteen years of experience in the field of Investment Management. The senior management team is well qualified with related experience and has demonstrated relative stability over the years.