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Pak Qatar Asan Munafa Plan Maintains Stability under Pak Qatar Islamic Cash Fund, Reports PACRA

Karachi, The Pak Qatar Asan Munafa Plan (PQAMP), a key initiative under the Pak Qatar Islamic Cash Fund, continues to demonstrate stability and sound performance in the financial market. The Plan, tailored for retail investors with short-term liquidity needs, prioritizes yearly dividends while investing in Shariah-compliant low-risk instruments.

According to The Pakistan Credit Rating Agency Limited, the PQAMP, along with the Pak-Qatar Cash Plan and Pak-Qatar Daily Dividend Plan, operates under the Pak Qatar Islamic Cash Fund, an open-ended Shariah-compliant money market fund. The Fund aims to maximize investor returns by investing in authorized Shariah-compliant avenues. PQAMP is designed specifically for retail investors seeking competitive returns with maximum possible preservation of capital, focusing on low-risk and liquid Shariah-compliant instruments. The Plan, with a perpetual term, has the flexibility to change dividend frequency to benefit unit holders, subject to prior intimation.

As of the end of September 2023, the Asset Under Management (AUM) size of PQAMP was approximately PKR 214 million, up from PKR 204 million in June 2023. The Fund's allocation as of September 2023 included approximately 63.4% in deposits and placements with AA and above-rated banks, around 28.01% in AAA-rated Government of Pakistan Ijara Sukuk, and about 7.23% in AA and above-rated Corporate Sukuk. This allocation strategy has effectively limited the exposure to interest rate and credit risks, with the duration and Weighted Average Maturity (WAM) of the Fund standing at 47 days at the end of September 2023. The unit holding pattern of the Fund was concentrated among the top four investors, with around 91.8% being related parties, thereby reducing exposure to redemption pressures. The Fund's liquid profile and compliance with credit quality criteria as of September 2023 have bolstered its ability to meet redemptions. Performance-wise, the Fund achieved an annualized return of 17.6% as of September 2023, aligning with its peers.

PACRA notes that any significant changes in the investment policy or the rating criteria could impact the stability rating of the Plan. The Plan's risk profile may vary slightly due to the volatility of economic conditions.

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