Press Release

JCR-VIS Reaffirms Fund Stability Rating of AKD Aggressive Income Fund at BBB (f)

Karachi, March 27, 2012: JCR-VIS Credit Rating Company Limited has reaffirmed the Fund Stability Rating (FSR) of AKD Aggressive Income Fund (AKDAIF) at ‘BBB (f)’ (Triple B (f)).

Given the re-categorization of the fund to aggressive income, the fund now has greater room to assume risk as per the regulatory criteria. However, the operational investment policy envisages a more conservative asset allocation strategy. Actual asset allocation of the fund is not in line with the credit rating criteria outlined in operational investment policy in view of deterioration in risk profile of some exposures; however, fresh exposures taken by the fund have so far been in line with the policy.

Around 49% of the fund’s assets comprised exposure in corporate debt instruments, placements with NBFCs and redeemable preference shares. Proportion of high risk assets is sizeable; though it has declined on a timeline basis, with recoveries made against some of these assets. Exposure to MTS comprised 25% of total assets and cash and bank balances represented 23% of total assets. Exposure in Margin Trading System (MTS) and spread transactions can comprise up to 50% of net assets.

Annual return of the fund has remained positive; comparing favorably to peers, though performance of the fund has shown considerable variability on a month to month basis. Going forward; return of the fund may witness pressure on account of high risk assets, unless high yields from MTS absorb the impact of non-performance.

Investor profile of the fund features concentration. Moreover, marketability of exposure in corporate debt instruments is low. Liquidity profile may witness stress in case of redemption pressure.

For further information on this rating announcement, please contact Mr. Javed Callea (Ext: 501) or Ms. Sobia Maqbool, CFA (Ext: 506) at 35311861-70 (10 lines) or fax to 35311872-3.




Jamal Abbas Zaidi
Deputy CEO

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS , the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2012 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .