PACRA Maintains Stability Rating of 786 Smart Fund

786 Smart Fund (‘786SF’ or ‘the Fund’) is a medium-risk profile fund. The objective of the Fund is to provide competitive, risk-adjusted returns to its investors by investing in a diversified portfolio of long-, medium-, and short-term Shariah-compliant debt instruments while taking liquidity considerations into account. As of end-June 2025, in terms of asset allocation, the Fund had allocated approximately 61.39% to bank placements, 36.57% to TFCs/Sukuk, and 2.04% to others.
From a credit quality perspective, the Fund had invested around 61.17% in AAA-rated avenues, 17.18% in A+, 16.74% in AA, 2.16% in AA-, 0.47% in D, 0.21% in A, with the remaining in unrated exposures. The Fund size at end-June 2025 stood at approximately PKR 1,513.8 million, while the Weighted Average Maturity (WAM) was 234 days.
However, concentration risk persists, as the top three Sukuk exposures Mughal Iron & Steel Industries Ltd. (12.7%), Pakistan Telecommunication Co. Ltd. (7.2%), and K-Electric Ltd. (6.02%)collectively represent a significant portion of the Fund’s Sukuk holdings. The portfolio includes a small exposure (~0.47%) to a non-performing instrument rated ‘D’ (Agha Steel Industries Limited). Although this exposure has been partially provided for, it warrants continued monitoring. The Fund also holds a few fully provided-off investments that have been written down to zero value, reflecting timely recognition of credit impairments.
Going forward, any material changes in the investment policy and/or compliance with the rating criteria for the assigned rating would have an impact on the ratings.

About the Entity
786 Investments Limited is a public listed company and was founded in 1990. The key shareholders are Miss Tara Uzra Dawood (~29.9%), B.R.R. Guardian Limited (~16.53%), and Bank of Khyber (15%). The remaining shareholding of ~45% is held by other individuals and entities. The Company had AUM's of ~PKR 1,951mln at end of Jun'25. 786 Investments Limited has a seven-member board including the CEO, Ms. Tara Uzra Dawood. She holds a Doctorate in judicial science from Harvard Law School. She has around two decades of professional experience in mergers and acquisitions, corporate law and investment management. She is supported by an experienced core management team. The other board members comprise four independent directors including Mr. Ahmed Salman Munir, who is also the Chairperson of the board. He has more than 30 years of progressive experience working with Fortune many companies both inside and outside Pakistan.