Analyst
Shahzaib Khalid
shahzaib.khalid@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
PACRA Assigns Initial Stability Rating to Askari Islamic Income Fund
Rating Type | Stability Rating | |
Current (06-Mar-19 ) |
||
Action | Initial | |
Long Term | A(f) | |
Short Term | - | |
Outlook | - | |
Rating Watch | - |
The objective of the Fund is to provide investors a Shariah compliant product with stable halal income. The fund would target on capitalizing available opportunities in the Shariah compliant income generating instruments. The Fund will focus on superior quality portfolio compared with average portfolio quality of Islamic income funds in the industry and enhanced returns over a 3 month horizon.
At end Dec’18, fund's exposure in corporate Sukuks was ~57% rated 'AA' and 'A'. The fund has ~40% investments as cash balances with banks having minimum of A- rating. The assigned rating takes into account the fund's overall risk appetite which exposes the fund towards a medium level of risk. The unit holding pattern of the fund shows redemption pressure over the fund as top ten investors represents 80% 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
Pak Oman Asset Management Company Limited was incorporated on July 28, 2006 as a public unlisted company. It is licensed by the Securities and Exchange Commission of Pakistan to carry out asset management and investment advisory services under the Non-Banking Finance Companies Regulations. The company is a majority owned subsidiary of Pak Oman Investment Company Limited (97%). The remaining shareholders include Oman International Development Company (1.2%), Bank Muscat (0.6%) and National Logistic Cell (1.2%).
The company’s Board of Directors comprise seven members including the managing director of Pak Oman Investment Company, Mr. Bahauddin Khan. The board’s chairman H.E. Yahya Bin Said Bin Abdullah Al-Jabri is the Minister of the Special Economic Zone Authority at A’Duqum, Sultanate of Oman. The company’s diverse product slate includes eleven open-end funds as at Feb'19 belonging to all major categories. Pak Oman has four open-end funds under its name, while seven open-end funds belonged to Askari Investment Management Limited which were acquired by Pak Oman Asset Management Company.