Karachi: The Pakistan Credit Rating Agency Limited (PACRA) has reaffirmed the stability rating for the Atlas Islamic Income Fund (AIIF), a medium-risk profile fund, underscoring its commitment to providing a stable income stream while adhering to Shariah compliance. The fund's asset allocation and credit quality metrics reflect its strategic investment approach.

As of December 2024, AIIF's asset allocation included approximately 40.76% in bank deposits, 32.39% in Ijarah Sukuk, 15.56% in Sukuk, and 7.40% in placements with banks and development finance institutions (DFIs). The remainder was invested in other financial instruments.

The fund's credit quality distribution was notable, with around 42.34% of the portfolio invested in AAA-rated or government securities, 42.30% in A+ rated instruments, 8.87% in AA+ rated, 3.95% in AA rated, and 2.18% in A rated avenues. The remaining portion was allocated across other categories.

With a weighted average maturity (WAM) of 255 days as of December 2024, AIIF faces high credit rate risk. However, the fund maintains a portfolio duration of 81 days, indicating a low exposure to interest rate fluctuations.

The unit holding profile of AIIF shows moderate investor concentration, with the top 10 unitholders accounting for 34.52% of the total assets under management. This spread suggests a diverse investor base, enhancing the fund's liquidity resilience and reducing the potential impact of redemption-driven volatility.

Moving forward, the fund's asset allocation strategy will be pivotal in maintaining its credit quality and managing interest rate risk exposure.