PACRA Affirms Stability Rating for Alfalah GHP Islamic Income Fund

Karachi: The Pakistan Credit Rating Agency Limited (PACRA) has affirmed the stability rating of the Alfalah GHP Islamic Income Fund (AGIIF), maintaining its classification under a medium risk profile. The fund aims to minimize risk by creating a liquid portfolio of Shariah-compliant fixed income investments, while offering competitive returns to its unit holders.

As of June 2025, AGIIF reported Assets Under Management (AUM) amounting to PKR 5.391 billion. The fund’s asset allocation demonstrated a diversified approach, with 59.36% of net assets invested in cash placements, 26.62% in term finance certificates and Sukuks, and the remaining 12.67% in government-backed or government-guaranteed securities. A small portion, 1.35%, was allocated to other investments, including receivables.

In terms of credit quality, AGIIF maintained a robust portfolio with 63.9% of its assets in government securities or instruments rated AAA. A further 20.67% was allocated to A+ rated avenues, and smaller allocations were made to instruments rated A1, AA-, AA+, and A1+. Only 1.35% of the portfolio was invested in other categories. This strategic focus on investment-grade assets aims to mitigate credit risk while ensuring adherence to Shariah principles.

AGIIF’s weighted average maturity stood at 507 days as of June 2025, reflecting a balanced strategy between yield optimization and interest rate risk management. This moderate maturity profile allows the fund to maintain reinvestment flexibility within a stable policy rate environment, while generating consistent income through its exposure to Sukuks and government-backed securities.

PACRA noted that any significant changes to the fund’s investment policy or compliance with rating criteria could impact its stability rating in the future.