Lahore, October 06, 2020 (PPI-OT): The rating reflects the Company’s positioning as one of the leading players in the AMC industry, supported by strong control environment, structured Investment processes, good governance framework and qualified management team. The rating upgrade takes into account improvement across key performance areas including investment management, fund performance, control framework and growth and diversity in assets under management. The rating reflects the sizable growth in AUMs of the Company, which have increased by ~50% at end Jun’20 on YoY basis.
The growth momentum is expected to continue with management focusing on strengthening its digital presence and outreach. The Company is also managing one of the largest AUMs base under SMA segment and holds significant share of the investment advisory domain. The Company has segregated its Compliance and Risk Management function in line with the best practices to strengthen its control environment. The Company has a large retail customer base with improving granularity resulting in stable AUMs. With a comprehensive portfolio of fifteen open-end mutual funds and two voluntary pension schemes, the Company offers a wide range of products for its customers.
The Company’s association with MCB Bank Limited – one of the largest commercial bank – and ensuing synergies have supplemented growth. The funds under management have shown consistent and good long term performance when compared to peers. The profitability of the Company has improved notably in FY20 on the back of improving revenue generation ability and declining sales and marketing expenses due to a shift towards digitization. The Company enjoys sound liquidity and has sufficient lines available, if need arises.
The rating is dependent upon the Company’s ability to sustain its market share and upholding strong investment processes and control environment. Meanwhile, consistent performance of funds compared to benchmark and peers is critical. Any sustained downturn in fund performance and/or significant loss in market share will impact the rating.
For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com