The Pakistan Credit Rating Agency Limited
30-Jun-18
Analyst
Muhammad Usman
muhammad.usman@pacra.com
+92-42-35869504
www.pacra.com
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Related Research
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PACRA Maintains Stability Rating of Alfalah GHP Cash Fund
| Rating Type | Stability Rating | |
|
Current (30-Jun-18 ) |
Previous (12-Jul-17 ) |
|
| Action | Maintain | Maintain |
| Long Term | AA+(f) | AA+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
The investment objective of Alfalah GHP Cash Fund (AGCF) is to generate at competitive returns while preserving capital by investing in assets with low risk and a high degree of liquidity from a portfolio constituted of mostly money market securities and placements.
The rating reflects the good change in the investment strategy to reduce the duration of the fund. During the year, the fund's exposure reflected strong credit profile emanating from its investment policy to invest in high credit quality instruments with portfolio duration not exceeding 45 days. . At end-Dec17, fund maintained sizeable exposure in banks (Dec'17: 99%). The duration remained less than 60 days in the past 6 months. The fund remains prone towards redemption risk as top 10 investors represent 95% of the fund size.
Going forward, the rating remains dependent on maintaining exposure with high credit quality financial institutions with portfolio duration less than 60 days. Meanwhile, the remaining assets of the fund must be placed with scheduled banks having very strong credit quality. PACRA would monitor compliance against agreed parameters on a monthly average basis.
About
the Entity
Alfalah GHP Investment Management Limited, with Bank Alfalah Limited as one of the main sponsors, was incorporated on October 18, 2004, as a public limited company. The company commenced its operations in March 2005 and is registered as an Asset Management Company and Investment Advisor under the Non-Banking Finance Companies Regulations. The company operates through its head office in Karachi and have branches in the major cities.
Company’s eight-member BoD includes the CEO along with two representatives of BAFL, one representative of GHP Beteligungen Limited, one representative of MAB Investments and two directors are independent. The board is chaired by Mr. Adeel Khalid Bajwa. He is the CEO of Dhabi Group based in Abu Dhabi, United Arab Emirates. 1.2.2 The company is currently managing a diverse product slate of twenty funds. During CY17, the company launched a Shariah Compliant Fund of Funds.