Muhammad Zain Ayaz
PACRA Maintains Stability Rating of Atlas Income Fund
|Rating Type||Stability Rating|
The rating reflects the Fund's medium exposure to interest rate volatility, strong credit profile, and diversification of assets. At end Dec’20, fund's exposure to T-Bills was ~40.2%, ~23% in TFCs rated ‘AA’ and above, while ~23.6% was invested in PIBs. The offering document of the Fund allows it to invest in banks rated 'BBB' and above. The duration of the Fund was 210 days at end Dec'20. This exposes the Fund to interest rate risk. The unit holding pattern of the Fund is highly concentrated as top 10 investors represents ~86%, ~70% of which are related parties. This exposes the Fund to a low level of redemption pressure.
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.
Atlas Asset Management Limited, incorporated in August 2002, is a wholly owned subsidiary of Shirazi Investments (Pvt.) Limited – the holding company of Atlas Group. Atlas Group, founded in 1962 with the establishment of Shirazi Investments, is a diversified group having presence in manufacturing, power, financial services, and trading. It consists of four companies listed on the Stock Exchange in Pakistan and a number of non-listed companies. The Company’s seven-member Board of Directors comprises five representatives of Atlas Group including the CEO, the other two are independent directors. Mr. Iftikhar H. Shirazi is currently Chairman of Shirazi Investments (Pvt) Limited. The board has two sub-committees for providing oversight on the Company’s affairs: 1) Audit Committee and 2) Human Resource & Remuneration Committee. The Company had AUM's of ~ PKR 40.4bln at end Dec'20 (Dec'19: ~PKR 31bln).