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The Pakistan Credit Rating Agency Limited
Press Release

Date
27-Sep-20

Analyst
Usama Zubair
usama.zubair@pacra.com
+92-42-35869504
www.pacra.com

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This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Maintains the Asset Manager Rating of First Capital Investments Limited

Rating Type Asset Manager
Current
(27-Sep-20)
Previous
(27-Sep-19)
Action Maintain Maintain
AM Rating AM4++ AM4++
Outlook Negative Negative
Rating Watch Yes Yes

The rating reflects the company's modest market share, adequate organizational structure, weak fund performance and limited fund slate comprising a single fund. The Company's AUMs have witnessed up stick by 8.8% since Jun'19 and stood at PKR 106mln at end Jun-20. The net losses of the Company has been decreased from PKR 49mln (Jun-19) to PKR 5mln (Jun-20), due to unrealized gain on investments. While the equity of the Company has come under pressure due to losses and currently stands at PKR 202mln at end Jun-20, which is slight above the regulatory requirement. The ratings of the Company are placed on Watch and highlight the need to fill the gap, while ensuring no further depletion in equity. PACRA will monitor the situation and may take future action accordingly.
The rating is dependent on the board's decision regarding the future prospects and continuity of business operations. Meanwhile, maintaining all regulatory requirements are critical. Any shortfall in this regard will have a negative impact.

About the Entity
First Capital Investments Limited (FCIL) commenced operations in 1995. The company is sponsored by First Capital Securities Corporation Limited (FCSC) the holding company of First Capital group with 78.85% shareholding. Mr. Sulaiman Ahmed Said AlHoqani - An Omani Investor - holds a strategic stake of 9.2% in FCIL and major shareholding in FCSC. FCIL is currently managing one open-end, equity fund namely First Capital Mutual Fund (FCMF) with assets under management of PKR 106mln at end Jun-20. The Board of Directors comprises four members, including the CEO Mr. Imran Hafeez. The remaining two members including the chairman are independent.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.