Meezan Cash Fund Reports Positive Growth and Performance for Investors

Karachi: Meezan Cash Fund (MCF) has reported a positive return of 21.22 percent for its investors for the year ended June 30, 2024. The fund, which primarily invests in Shariah-compliant money market instruments and Islamic bonds (Sukuks), has demonstrated effective management of assets, with a net asset value increase to PKR 51.28 million.

According to information available from the Pakistan Stock Exchange (PSX), the fund’s objective is to seek maximum possible preservation of capital while providing a reasonable rate of return through investments in liquid Shariah-compliant money market instruments. As part of its investment policy, MCF has limited the duration of its investments to a maximum of six months, focusing on maintaining liquidity and minimizing interest rate risk.

The asset allocation for the fiscal year 2023 and 2024 shows a strategic increase in cash and other receivables, which now represent 68 percent of the total assets, compared to 74 percent the previous year. Sukuks and placements with banks accounted for 11 percent and 19 percent, respectively. The fund’s focus on cash reserves aims to provide liquidity and flexibility for future investments.

For the year ending June 30, 2024, Meezan Cash Fund reported a gross income of PKR 8.40 billion, a significant increase from PKR 3.44 billion in the prior year. This increase was largely attributed to profits from bank deposits, placements, and Sukuks. The fund’s total net income rose to PKR 7.92 billion, contributing to a substantial growth in the net asset value.

The fund distributed an interim cash dividend of PKR 10.54 per unit, translating to a distribution rate of 21.08 percent. The total cash distribution from the fund was PKR 2.87 billion for the fiscal year.

The stability rating assigned by VIS Credit Rating Company to Meezan Cash Fund is AA+(f), indicating a solid financial standing. The breakdown of unit holdings as of June 30, 2024, reveals a diverse investor base, with 36,720 investors holding fewer than 10,000 units, while 334 investors hold 500,000 units or more.