Analyst
Muhammad Usman
muhammad.usman@pacra.com
+92-42-35869504
www.pacra.com
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Related Research
PACRA Maintains Stability Rating of Alfalah GHP Islamic Income Fund
Rating Type | Stability Rating | |
Current (03-Dec-18 ) |
Previous (30-Jun-18 ) |
|
Action | Maintain | Maintain |
Long Term | A+(f) | A+(f) |
Short Term | - | - |
Outlook | Stable | Stable |
Rating Watch | - | - |
The investment objective of Alfalah GHP Islamic Income Fund (AGIIF) is to minimize risk, construct a liquid portfolio of shariah approved fixed income investments and provide competitive returns to the Unit Holders. The management team shall ensure the active implementation of prudent investment practices, the highest professional standards and compliance with applicable laws.
The rating reflects the fund's good credit quality and sound liquidity profile emanating from its ~65% exposure as cash with banks. The other ~25% assets of the fund were invested in good quality corporate sukuks having rating of 'A-' and above at the end of Jun-18. Meanwhile, the rating incorporates the fund's low exposure to interest rate volatility. The unit holding pattern of the fund is concentrated with top 10 investors representing ~88% of the fund's assets, (of which ~65% is the group's investments) which exposes the fund to a low level of redemption pressure.
Going forward, the management intends to maintain the current investment strategy. Material changes in the fund's asset allocation strategy, which could negatively impact the fund's credit quality and exposure to interest rate risk, remains critical for the rating.
About
the Entity
Alfalah GHP Investment Management Limited was incorporated on October 18, 2004, as a public limited company. The major shareholders of the company are Bank Alfalah Limited with ~ 40% stake followed by MAB Investment Inc with ~ 42% stake. The company commenced its operations in March 2005 and is registered as an Asset Management Company and Investment Advisor under the Non-Banking Finance Companies Regulations. The company operates through its head office in Karachi and have branches in the major cities. The company is currently managing a diverse product slate of twenty funds.
Company’s eight-member BoD includes the CEO along with two representatives of BAFL, one representative of GHP Beteligungen Limited, one representative of MAB Investments and two directors are independent. The board is chaired by Mr. Adeel Khalid Bajwa. He is the CEO of Dhabi Group based in Abu Dhabi, United Arab Emirates.