The Pakistan Credit Rating Agency Limited
09-Aug-19
Analyst
Shahzaib Khalid
shahzaib.khalid@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Assigns Positive Outlook to Asset Manager Rating of Alfalah GHP Investment Management Limited
| Rating Type | Asset Manager | |
|
Current (09-Aug-19 ) |
Previous (08-Feb-19 ) |
|
| Action | Maintain | Maintain |
| AM Rating | AM2+ | AM2+ |
| Outlook | Positive | Stable |
| Rating Watch | - | - |
The rating reflects the company's superior ability to increase its market share in distressed macro economic environment. The rating incorporates the management’s focus towards strengthening client base through digital initiatives, own branches and team expansion and sponsor bank's distribution network. The rating also reflects the company’s sound governance structure, seasoned management team, structured investment process and the competitive performance of the company's funds when compared to peers. While the industry witnessed decline of ~11% in FY19, the AUM of the company increased by 22%. The growth in AUM has translated into higher system share. Alfalah GHP, through its own initiatives and capitalizing on parent bank’s network, has gained momentum towards increasing its AUM. The company has prominent position in the investment advisory domain. The company's association and effective synergies with Bank Alfalah, a renowned financial institution, provides support to the rating.
The positive outlook captures the company’s augmented ability to expand its AUM base in light of the business strategy. The rating is dependent on the organization's capacity to effectively execute its business plan leveraging on group synergies to strengthen its system share. Sustainable fund performance, increasing market share and translation of initiatives to increase retail AUM will be positive rating drivers.
About
the Entity
Alfalah GHP Investment Management Limited was incorporated in October 2004, as a public limited company. The major shareholders of the company are MAB Investment Inc with ~42% shareholding followed by Bank Alfalah Limited with ~ 40% shareholding. 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. The company is currently managing a diverse product slate of sixteen funds.
The company’s eight-member Board includes the CEO along with two representatives of Bank Alfalah, one representative of GHP Beteligungen Limited, two representatives of MAB Investments and two directors are independent. The board is chaired by Ms. Dominique Russo. She is the CEO of Dhabi Group based in Abu Dhabi, United Arab Emirates.