AWT Investments Limited

CREDIT RATING REPORT | Jul-25

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Rating History
Dissemination Date Rating Outlook Action Rating Watch
31-Jul-25 AM2+ Stable Upgrade -
31-Jul-24 AM2 Stable Upgrade -
04-Aug-23 AM3++ Positive Maintain -
05-Aug-22 AM3++ Positive Maintain -
05-Aug-21 AM3++ Stable Initial -
About the Entity

AWT Investments Limited, a public unlisted Company incorporated in August 2011, is headquartered in Rawalpindi. The AMC's Board of Directors consists of six members, including the Chief Executive Officer. Currently, AWTIL offers seven Islamic funds across various categories, including Money Market, Equity, Income and Pension. Lt. Gen. Nauman Mahmood (Retd.) was appointed Chairperson of the Board in February 2024. With 38 years of extensive experience, he also serves on the boards of various businesses under the Army Welfare Trust. Mr. Sajjad Anwar, CFA, serves as the Chief Executive Officer of AWTIL. He is a seasoned investment professional with over 25 years of comprehensive experience in Pakistan’s financial markets.

Rating Rationale

AWT Investments Limited ("AWTIL" or the "AMC") is an emerging player in the evolving asset management industry, focusing on expanding its customer outreach through superior investment performance, a well-diversified fund portfolio, focused marketing efforts and strong management expertise. As a fully owned entity of the Army Welfare Trust, which is dedicated to the welfare of martyrs’ families, AWT Investments Limited has gained upward momentum during the period in Pakistan’s asset management industry, as evidenced by its improved relative standing among peers. The rating upgrade of the AMC reflects enhancements across multiple key performance areas, including improved fund performance, growth and diversification of assets under management with a strategic focus on the retail segment, enhanced customer services and improved profitability. AWTIL continues to prioritize retail penetration, which has contributed to greater stability and longevity in its asset base. The AMC demonstrates a well-balanced and healthy client base, with a clientele mix comprising 45% retail investors and 55% institutional investors. AWTIL has witnessed significant growth in new account openings, driven by its focused marketing efforts and public awareness initiatives. On the digital side, the AMC is in the process of launching Mobile App v2.0, which is expected to be launched soon. During 9MFY25, the AMC demonstrated a robust 100% growth in AUMs since Jun'24, clocking in at PKR 60bln (Jun'24: PKR 30bln). The AMC's market share doubled to 2% in 9MFY25 (FY24: 1%), reflecting improved positioning relative to its peers. Wherein, AWT Islamic Income Fund carries the significant weightage in total AUMs; dilution is encouraged. However, the Fund significantly attracted a high number of accounts. The Fund performance remained in top quartile during the trailing 12 months ending on Mar'25. At the end of April 2025, AWTIL expanded its product portfolio through the launch of Voluntary Pension Schemes (VPS). This strategic initiative marks a significant step in diversifying the AMC’s portfolio, catering to long-term retirement planning needs of individual investors. During 9MFY25, the financial matrix reveals that the management fee of the AMC increased significantly by 2 times, consequently, the AMC reported a net profit of PKR 146mln in 9MFY25 (9MFY24: PKR 49mln). At the end of 9MFY25, the equity base of the AMC increased to PKR 596mln (FY24: PKR 450mln), wherein in addition to internally generated profits, the sponsor's support in the form of fresh equity remains critical. Furthermore, AWTIL has initiated its transition toward becoming a fully Shariah-compliant asset management company, with full conversion expected in the near future. The process has been initiated through the transformation of its conventional funds into Shariah-compliant funds. Since Jun'24, the AMC’s presence in the Islamic asset management industry has strengthened, with market penetration rising to 3.4%. (Jun'24: 1.9%)

Key Rating Drivers

The rating is dependent on the AMC’s ability to continuously strengthen its market position. At the same time, stability in key human resources, structured improvement in risk management framework, and success of initiatives to increase retail AUM will remain crucial for the rating. Diversification in the AUM base among various fund categories along with improvements in the overall operating platform will bode well for the Company.

REPORT CONTENTS
  1. Rating Analysis
  2. Financial Summary
  3. Rating Scale
  4. Regulatory Disclosure

AWT Investments Limited

rating analysis

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Profile
Structure

AWT Investments Limited ("AWTIL" or the "AMC") is a public unlisted Company incorporated in August 2011.


Background

AWTIL is licensed by SECP as an Asset Management Company, Investment Adviser, and Pension Fund Manager under NBFC Regulations. AWTIL is gradually transitioning to a fully Shariah-compliant AMC by converting its conventional funds into shariah-compliant funds.


Market Share

The AMC’s overall market share improved to 2% (FY24: 1%), while its penetration in the Islamic AMC industry improved significantly to 3.4%, up from 1.9% in June 2024.


Diversification of Fund Mix

Currently, the AMC is offering investment solutions for both conventional and islamic markets and is managing seven funds in the money market, income, equity and pension categories with the income category having the highest concentration of 94.6% in the portfolio.


Investor Concentration

The top 10 investor concentration at the end of 9MFY25 is 34% while the related party holding represents 5% of total AUMs.


Ownership
Ownership Structure

AWTIL is a wholly owned subsidiary of Army Welfare Trust (AWT).


Business Acumen

The existing sponsor, AWT has more than 5 decades of experience in the financial services sector, operating companies under the “Askari” brand in banking, insurance, leasing, financial services, and asset management industries. The management and leadership carry extensive business experience in financial markets.


Financial Strength

The sponsor, AWT Group, continues to demonstrate strong financial standing, underpinned by its diversified and profitable business operations. This strength is reflected in its ongoing support for AWTIL, evidenced by equity injections over the years. Most recently, as per management, the sponsor injected PKR 250mln in the form of cash in June 2025.


Governance
Board Structure

The AMC’s Board consists of six members, including the CEO. The Board comprises five non-executives and one executive director.


Members’ Profile

Lt. Gen. Nauman Mahmood (Retd.) was appointed Chairperson of the Board in February 2024. A graduate of prestigious military institutions including the National Defence University, he brings 37 years of experience in different key roles. He currently serves as Vice Chairperson & MD of Army Welfare Trust and sits on the boards of several AWT businesses. Board members carry diversified experiences in different business areas.


Board Effectiveness

There are two committees, namely 1) HR Committee and 2) Audit and Risk Committee for effective monitoring and Board assistance.


Transparency

The in-house internal audit department is headed by Mr. Sarmad Maqsood Paracha. Mr. Sarmad, a certified auditor (ACA, CISA, FCCA), brings extensive cross-sector experience and has been key in strengthening controls, streamlining audits, and advising senior leadership. The external auditor of the AWTIL is Yousuf Adil & Co, which falls in the ‘A’ category of the SBP Panel of Auditors.


Management
Organizational Structure

The AMC is guided by a robust and formal organizational structure, ensuring clear departmental segmentation. Key functions are carried out through specialized departments—Human Resources, Risk Management, Compliance, Information Technology, Marketing & Product Development, and Finance—each entrusted with clearly defined roles and responsibilities to support efficient and effective operations.


Management Team

The senior management team of AWTIL comprises qualified and experienced professionals. Mr. Sajjad Anwar, CEO of AWTIL, is a seasoned investment professional with over 25 years of experience in Pakistan’s financial markets, including 17 years in the fund management industry. Prior to joining AWTIL, he served as Chief Investment Officer at NBP Funds. The Chief Financial Officer, Mr. Salman Shafiq Hashmi, has tendered his resignation. The position is currently vacant.


Technology Infrastructure

AWTIL is currently revamping its fund management solutions software, developed by Softech Company, and is also undertaking ERP evaluations for internal operational enhancements. Additionally, the AMC is in the process of launching Mobile App v2.0, which is expected to be completed soon.


Control Environment

The compliance department is being led by Mr. Muzzammil Khan, having over 13 years of professional experience in compliance, operations, audit, and assurance. The AMC has devised detailed policies to ensure compliance with all applicable statutory regulations and internal investment guidelines using Excel- based models to monitor the exposure limits and margins.


Investment Risk Management
Credit Risk

AWT Investments Limited used Excel-based credit risk models for credit risk monitoring with a focus on qualitative and quantitative analysis with controls in place to ensure exposure limits.


Liquidity Profile

The risk management department vigilantly monitors the liquidity profile of the AMC. The liquidity is maintained by investing a significant portion of funds assets in liquid investment avenues.


Market Risk

For managing market risk, various techniques such as VaR analysis, beta analysis, and stress testing are being used. The exposure limits are communicated to portfolio managers along with a periodic review of the appropriateness of the limit structure.


Portfolio Management
IC Composition

The investment committee comprises the Chief Executive Officer, Chief Finance Officer, Head of Risk, and Fund Managers.


Effectiveness

The IC comprises qualified and experienced professionals and meets on a weekly basis to review the investment strategy of each fund under management and its performance to incorporate the impact of market circumstances on the Funds’ performance.


Investment Research and Analysis

The research function, overseen by the Head of Research, employs fundamental analysis and standard financial models for equity valuation, supplemented by broker research, to identify attractive investment opportunities.


Customer Relationship
Investor Services

The AMC delivers satisfactory client services, with the marketing team managing relationships with current and potential clients. To stay competitive, it is integrating IT across operations. Its mobile app offers key features like fund NAVs, account details, and e-transactions.


Investor Reporting

The AMC disseminates unit holder statements on a monthly basis which comprise investment value and asset allocations. AWTIlL disseminates and publishes FMR on its website in a timely manner.


Distribution and Sales Network

The AMC has four branches in Karachi, Lahore, Multan, and Rawalpindi. It is developing a digital client onboarding solution, expected by Dec'25. Meanwhile, focused marketing and awareness efforts led to strong growth in new account openings.


Performance
Asset Under Management

The AMC’s AUMs has been increased by 100% and stood at PKR 60bln at end of 9MFY25 (FY24: PKR 30bln). The flagship fund of the AMC is AWT Islamic Income Fund, with a weightage of 91% in total AUMs of the AMC. However, the fund significantly attracted a high number of accounts. The fund performance remained in top quartile during the trailing 12 months ending on Mar'25.


Asset Manager

At the end of 3QFY25, the management fee increased by 2 times, standing at PKR 219mln (SPLY: PKR 73mln). Whereas, profit after tax of AWTIL stood at PKR 146mln, primarily due to an increase in management fee applicable on different funds at the end of 3QFY25 (SPLY: PKR 49mln). The equity of the AMC stood at PKR 596mln at the end of 3QFY25 (FY24: PKR 450mln). The AMC has ample room to meet the minimum equity base requirement of PKR 230mln.
 
 

Jul-25

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AWT Investments Limited

rating scale

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Jul-25

www.pacra.com

AWT Investments Limited

regulatory disclosure

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  1. Rating Team Statements
    1. Rating is just an opinion about the creditworthiness of the entity and does not constitute a recommendation to buy, hold, or sell any security of the entity rated or to buy, hold, or sell the security rated, as the case may be. (Chapter III; 14-3-(x))
    2. Conflict of Interest
      1. The Rating Team or any of their family members have no interest in this rating (Chapter III; 12-2-(j))
      2. PACRA, the analysts involved in the rating process, and members of its rating committee and their family members do not have any conflict of interest relating to the rating done by them (Chapter III; 12-2-(e) & (k))
      3. The analyst is not a substantial shareholder of the customer being rated by PACRA [Annexure F; d-(ii)]
      4. Explanation: for the purpose of the above clause, the term "family members" shall include only those family members who are dependent on the analyst and members of the rating committee.
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Jul-25

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