The Pakistan Credit Rating Agency Limited
Press Release


Muhammad Zain Ayaz

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PACRA Maintains Stability Rating of Atlas Income Fund

Rating Type Stability Rating
(16-Apr-21 )
(16-Oct-20 )
Action Maintain Maintain
Long Term AA-(f) AA-(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

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.

About the Entity
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).

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.