The Pakistan Credit Rating Agency Limited
24-Oct-19
Analyst
Afnan Iqbal
afnan.iqbal_old@pacra.com_old
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of Lakson Income Fund
| Rating Type | Stability Rating | |
|
Current (24-Oct-19 ) |
Previous (24-Apr-19 ) |
|
| Action | Maintain | Maintain |
| Long Term | A+(f) | A+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
The rating reflects the fund's credit quality and liquidity profile emanating from sizeable allocation of assets as bank placements. At end-Jun'19, the portfolio comprised cash balances (57%) with majority of exposure in 'AA-' and 'A' rated banks. The remaining assets of the fund were invested in TFCs (16%), PIBs (14%) and Sukuk (8%). The unit holding pattern of the fund is highly concentrated with the top ten investors representing ~95% of portfolio making the fund vulnerable to redemption pressure.
Going forward, the fund intends to maintain exposure in cash, while increasing its exposure in PIBs. Material changes in the fund's asset allocation strategy, impacting the fund's credit quality and exposure to interest rate risk, would affect the rating.
About
the Entity
Lakson Investments Limited, the investment management company of the Lakson Group, was incorporated on January 02, 2009 as an un-listed public company. It is licensed to undertake Asset Management and Investment Advisory services. The company has recently acquired the license to launch private equity and venture capital funds. The company’s control vests in eight-member board, comprising four non-executives of group companies, one executive and three independent directors. The Chairman of the Lakson Group, Mr. Iqbal Ali Lakhani, is the chairman of Lakson Investment’s board. The company is currently managing six open-end funds in diversified categories with an aggregate AUM base of ~PKR 15.8 billion at end-Sep'19, while the investment advisory portfolio has ~PKR 9.8 billion of assets under management at end-Sep'19.