PACRA Reaffirms Stability Rating for Pak Qatar Khalis Bachat Plan

Karachi: The Pakistan Credit Rating Agency Limited (PACRA) has maintained the stability rating of the Pak Qatar Khalis Bachat Plan under the Pak Qatar Islamic Income Fund. The long-term rating remains at A(f), with a stable outlook.

According to Pakistan Credit Rating Agency Limited, the Pak Qatar Islamic Income Fund is an open-ended, shariah-compliant income fund with a medium risk profile. The Fund aims to maximize returns for investors by investing in shariah-compliant avenues. The Pak Qatar Khalis Bachat Plan, one of the plans offered under this Fund, reported assets under management (AUM) of PKR 438 million at the end of September 2024.

The Fund’s asset quality aligns with PACRA’s rating criteria, with investments distributed across various credit-rated avenues. As of the end of September 2024, about 43% of the Fund’s investments were in AA- rated avenues, 28% in government securities or AAA, and 9% in AA+ rated avenues, among other categories. The majority of the investments were held in banks as cash and placements, followed by sukuk and commercial papers in both corporate and government sectors.

The weighted average maturity (WAM) of the plan was recorded at 741 days, indicating a high credit risk due to long-term investments in government securities. However, the Fund’s duration was limited to 12 days, reducing exposure to interest rate risk. The unit holding pattern showed a significant concentration among the top ten investors, which poses a high redemption pressure risk. Despite this, the presence of diversified and granular participants among the top investors provides a cushion against potential redemption pressures.

The report also noted that any significant changes in the investment policy or rating criteria could affect future ratings.

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