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Pak Qatar Khalis Bachat Plan Upholds Stability Amidst Economic Fluctuations

Karachi, The Pak Qatar Khalis Bachat Plan (PQKBP), part of the Pak Qatar Islamic Income Fund, has maintained a stable rating, reflecting its focus on providing Takaful benefits and yearly dividends under a stable income category. The plan is designed to generate superior, long-term, risk-adjusted returns in accordance with Shariah practices.

According to The Pakistan Credit Rating Agency Limited, the PQKBP, along with the Pak-Qatar Income Plan and the Pak-Qatar Monthly Income Plan, is offered under the Pak Qatar Islamic Income Fund, an open-ended Shariah-compliant income fund. The Fund falls under a medium-risk profile and aims to maximize investor returns by investing in Shariah-compliant, authorized avenues. PQKBP, with a perpetual term, is committed to investing in low-risk avenues, adhering to a policy of not investing in avenues rated below single A-. The Plan can invest up to 100% in Shariah-compliant government securities and cash at the bank and has the flexibility to change its dividend frequency to benefit its unit holders, subject to prior intimation.

As of the end of September 2023, PQKBP's Asset Under Management (AUM) size was PKR 343 million, an increase from PKR 313 million in June 2023. The Fund's allocation as of September 2023 included approximately 32.6% in deposits with AA and above-rated banks and around 62.4% in mainly A+ and above-rated Corporate Sukuk. The duration of the Fund stood at 42 days at the end of September 2023, exposing it to interest rate risk. The Weighted Average Maturity (WAM) of the Fund, standing at 492 days as of September 2023, indicated a high level of credit risk due to its investments in long-term Corporate Sukuk. The unit holding pattern of the Fund showed a high concentration among the top three investors, who are related parties, thereby reducing exposure to redemption pressures. Despite these concentrations, the Fund's strong liquid profile has sustained its ability to meet redemptions. The Fund remained compliant with credit quality criteria and achieved an annualized return of 17.4% as of September 2023, in line with its market 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 experience slight variations in response to the economic conditions' volatility.

The post Pak Qatar Khalis Bachat Plan Upholds Stability Amidst Economic Fluctuations appeared first on Pakistan Business News.