PACRA Maintains Stability Rating for Pak Qatar Monthly Income Plan

Karachi: The Pakistan Credit Rating Agency Limited (PACRA) has announced that it is maintaining the stability rating of the Pak Qatar Monthly Income Plan, part of the Pak Qatar Islamic Income Fund, at A+(f) with a stable outlook. The stability rating reflects the fund’s maintained position since May 31, 2024, amidst a medium-risk investment environment.

According to Pakistan Credit Rating Agency Limited, the Pak Qatar Islamic Income Fund, an open-ended shariah-compliant income fund, aims to maximize investor returns through shariah-compliant investment avenues. The fund’s asset quality remains adequate, aligning with the criteria set for its rating. As of the end of September 2024, the fund’s assets under management for the monthly income plan were recorded at PKR 1,102 million.

The fund’s investment strategy includes a significant allocation to high-rated avenues. At the end of September, allocations were approximately 44% in AA- rated avenues, 22% in government securities/AAA, and smaller percentages in other high-rated categories. The fund has maintained a weighted average maturity (WAM) of 634 days, indicating exposure to high credit risk primarily due to long-term government securities investments. The fund’s duration of 8 days minimizes interest rate risk exposure.

The unit holding pattern reveals that the top ten investors hold about 96.50% of the fund, which presents a high level of redemption pressure. However, these investors, including related parties, provide a buffer against aggressive redemption by other investors. The investment remains marketable, with adequate liquidity to address potential redemption risks. Future changes in investment policy or rating criteria could impact the fund’s ratings.

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