PACRA Maintains the Stability Rating of Alhamra Islamic Income Fund

Alhamra Islamic Income Fund ("AIIF" or "the Fund") is categorized under a medium-risk profile, with the objective of generating risk-adjusted returns through investment in short, medium, and long-term Shariah compliant fixed income instruments. As of Jun'26, the Fund's Assets Under Management (AUM) stood at PKR 16,529mln, compared to PKR 34,318mln as of Dec'25 (the last review), reflecting contraction in fund size during the review period, primarily attributable to an overall reduction in the Islamic income fund category size. In terms of asset allocation, approximately 72% of the portfolio was invested in cash, 24% in GoP Ijarah Sukuks, and ~2% in Sukuks, reflecting a well-structured Shariah compliant portfolio anchored in sovereign-backed Islamic securities, complemented by a dominant cash allocation that provides a very strong liquidity buffer. From a credit quality perspective, approximately 26% of the Fund's assets were invested in Government Securities and AAA rated instruments, ~42% in AA+ rated avenues, and ~28% in A+ rated instruments, with the remainder in other exposures. The overall credit profile is considered very strong, with the bulk of exposures concentrated in high-grade Shariah compliant instruments. The Fund's Weighted Average Maturity (WAM) stood at 365 days as of Jun'26, reflecting high sensitivity to interest rate movements, which is broadly consistent with the Fund's medium-risk Islamic income mandate and its strategy of capturing competitive yield across short to long-tenor Shariah compliant instruments. While this duration profile introduces a degree of mark-to-market sensitivity, the Fund's dominant cash allocation provides a meaningful offset to the interest rate risk inherent in its GoP Ijarah Sukuk exposure. Meanwhile, the unit holding pattern indicates a low degree of concentration, with the top 10 investors accounting for only ~32% of the Fund's total holdings, reflecting a well-diversified and broad-based investor base. In terms of performance, the Fund reported an annualized one-year return of 10.55% as of Jun'26, against a benchmark return of 10.07%, reflecting a an outperformance of approximately 48 basis points. This above-benchmark outcome is considered a commendable result for a medium-risk Islamic income fund, demonstrating the Fund's very strong capacity to generate competitive risk-adjusted returns through disciplined allocation across Shariah compliant fixed income instruments while maintaining its conservative investment discipline throughout the review period.
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 rating.

About the Entity
MCB Investment Management Limited (MCBIM) is a public listed company regulated by the Securities and Exchange Commission of Pakistan (SECP). It holds licenses for asset management, investment advisory, and pension fund management, catering to both Conventional and Shariah investment solutions. As of Dec 2025, MCBIM manages a diversified portfolio, including 26 Open-End Mutual Funds and 4 Voluntary Pension Schemes, while also maintaining a leading position in Separately Managed Accounts (SMA) and investment advisory services. MCBIM’s major shareholders include MCB Bank Limited (~81.42%), Adamjee Insurance Company Limited (~7.59%), and the general public (~9.28%). Mr. Khawaja Khalil Shah serves as the Chief Executive Officer of the company. The Board comprises a balanced composition of 4 Non-Executive Directors and 3 Independent Directors, ensuring strong governance, objective decision-making, and alignment with regulatory best practices. The Company’s assets under management (AUM) have grown significantly, reaching ~PKR 387 Billion as of Jun'26.