PACRA Maintains Stability Rating of AWT Islamic Income Fund

AWT Islamic Income Fund ("the Fund") is a medium-risk Shariah-compliant fixed income solution designed to deliver competitive risk-adjusted returns through a diversified portfolio of Islamic debt instruments. The Fund's investment approach combines rigorous Shariah compliance with active duration management, catering to investors seeking enhanced yields within an Islamic framework. As of December 2024, the Fund reported Assets Under Management (AUM) of PKR 48.1 billion, establishing it as one of Pakistan's largest Islamic fixed income funds. In terms of asset class, 43% was invested in Bai Muajjal, 27% in bank deposits, 14% in Government of Pakistan Ijara Sukuks, and 14% in short-term Sukuks, with the remainder in other approved Islamic instruments. From a credit quality perspective, 40% of assets were allocated to Government Securities and AAA rated instruments, complemented by 26% in AA+ rated and 15% in AA-rated avenues. This investment-grade concentration, representing 85% of the portfolio in AA- or better rated instruments, provides substantial protection against credit risk while maintaining strict Shariah compliance. With a Weighted Average Maturity (WAM) of 223 days as of December 2024, the Fund maintains moderate exposure to credit risk. This intermediate maturity profile reflects strategic positioning across Islamic yield curve opportunities, while the substantial sovereign exposure (14% GOP Ijara Sukuks) and high-quality credit allocation serve as stabilizing factors for the portfolio.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the ratings.

About the Entity
AWT Investments Limited (AWTIL) is a public unlisted company, incorporated in 2011. It operates as a Non-Banking Finance Company (NBFC), licensed by the Securities and Exchange Commission of Pakistan (SECP) to manage open-end and closed-end funds, as well as provide Investment Advisory Services. The company is a wholly-owned subsidiary of Army Welfare Trust (AWT). The Board of Directors consists of five members, including the CEO, Mr. Sajjad Anwar, a CFA charter holder with over 21 years of experience in Equity Research, Portfolio Management, Investment Advisory, Risk Management, and Finance & Accounts. Before joining AWTIL, he served as Chief Investment Officer (CIO) at NBP Funds, bringing extensive expertise in the fund management industry. As of the latest reports, AWT Investments Limited manages multiple funds, including Conventional and Shariah-compliant portfolios, with Assets Under Management (AUM) exceeding PKR 54 billion as of December 2024.