PACRA Maintains Stability Rating of Alhamra Islamic Income Fund

Alhamra Islamic Income Fund ("ALHIIF" or "the Fund") is classified under a medium risk profile. The objective of ALHIIF is aimed at generating risk-adjusted returns by investing in short, medium, and long-term Shariah-compliant fixed income instruments. As of June 2025, the Fund reported Assets Under Management (AUM) of PKR 42.78 billion, reflecting a contraction from PKR 68.96 billion in December 2024, primarily on account of redemptions by institutional participants amid shifting liquidity dynamics. Despite this moderation, the Fund retains a established position within Pakistan’s Shariah-compliant income fund category. In terms of asset allocation, 55.0% of the portfolio was allocated as Cash Placements, 41.4% in Government of Pakistan Ijara Sukuks, 1.3% in other privately placed Sukuks, 1.4% in others including receivables, and 0.9% in government-backed or guaranteed securities. The higher liquidity orientation represents a defensive positioning in response to evolving interest rate expectations, while the sovereign Sukuk exposure continues to anchor the portfolio’s stability. From a credit quality perspective, 42.8% of assets were invested in Government/AAA-rated instruments and 48.7% in AA/A1-rated avenues, with the remaining 7.0% and 1.4% allocated to A+ rated and other instruments, respectively. This high-grade composition underscores the Fund’s continued adherence to prudent credit selection and full compliance with Shariah investment principles. The Weighted Average Maturity (WAM) stood at 402 days as of June 2025, indicating a slightly above-moderate sensitivity to credit and rate movements. The duration strategy reflects a tilt toward maintaining flexibility while capturing opportunities along the mid-tenor segment of the Islamic yield curve. Overall, the Fund’s structure demonstrates a cautious yet return-conscious stance, balancing liquidity management with yield optimization under a stabilizing macroeconomic environment.
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 December 2024, 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 robust governance, objective decision-making, and alignment with regulatory best practices. The Company’s assets under management (AUM) have grown significantly, reaching approximately PKR 393 Billion as of June 2025, reflecting its strong market presence and consistent growth in Pakistan’s asset management industry.