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The Pakistan Credit Rating Agency Limited

Date
12-Jul-2017
Analysts
Rai Umar Zafar
rai.umar@pacra.com

Mohsin Naseer
mohsin.naseer@pacra.com

+92-42-35869504
www.pacra.com
Applicable Criteria

  • Methodology | Fund Stability Rating (Jun 17) [View]

Related Research

  • Sector Study | Mutual Funds (Oct 16) [View]
Disclaimer
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PACRA Maintains Stability Rating of Pak Oman Government Securities Fund
 Rating Type Stability Rating
Current
(12-Jul-2017)
Previous
(30-Dec-2016)
 Action Maintain Downgrade
 Long Term A+(f) A+(f)
 Short Term - -
 Outlook Stable Stable
 Rating Watch - -

The rating reflects the fund's very strong credit quality and a sound liquidity profile emanating from the fund's policy to invest 70% of asset in a mix of short-term and long-term government securities. At end-May17, 71% of the fund's exposure was in short term Government securities (T-bills) and the remaining portfolio was invested as cash (i.e. 21.4%) with "A-" rated avenues. On average basis, fund’s duration was below 2 years in the last quarter. The unit holding pattern of the fund is highly concentrated with top10 investors representing almost the entire fund, which reflects redemption risk.

Going forward, the rating remains dependent on maintaining at least 70% allocation towards government securities with portfolio duration not exceeding 2 years. PACRA would monitor compliance against agreed parameters on monthly average basis.
About the Entity
Pak Oman Asset Management Company Limited (POAMCL) is the management company for POGSF. The sponsors of POAMCL are Pak Oman Investment Company Limited (97%), Oman National Investment Corporation Holding (1.2%), National Logistics Cell (1.2%) and Bank Muscat (0.6%). The company is currently managing four mutual funds with AUMs of PKR 1.8bln at end-May17.

The CEO, Mr. Adeel Ahmed Khan joined as CEO of the company in Nov-15. He holds more than a decade experience in AMC industry. The fund manager, Mr. Meraj-Uddin, carries adequate experience in the domestic mutual fund industry.
The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.
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