⚡ Flash Summary

ABL Government Securities Fund (ABL-GSF) reported a return of 9.84% for the quarter ended September 30, 2025, underperforming its benchmark return of 10.65%. The fund’s AUM increased significantly to PKR 7,355 million, up 44.48% from PKR 5,077 million in June 2025. The fund’s asset allocation included 8.64% in PIBs, 54.00% in cash, and 36.53% in T-Bills. Monetary policy remained stable, with the policy rate unchanged at 11.00%, reflecting a cautious approach amid emerging inflationary pressures and volatile food prices.

📌 Key Takeaways

• 💰 AUM increased significantly by 44.48% to PKR 7,355 million from June 2025.
• 📊 Fund return of 9.84% underperformed the benchmark of 10.65%.
• 🏦 Asset allocation: 8.64% in PIBs, 54.00% in cash, and 36.53% in T-Bills.
• 📌 Monetary policy rate held steady at 11.00%, indicating stability.
• 📈 Headline CPI averaged 4.2% YoY, down from 9.2% in 1QFY25.
• ✅ Pakistan’s sovereign rating was upgraded by S&P and Moody’s.
• 💵 Liquid FX reserves stood close to US$19.8 billion by September.
• ⚠️ Fiscal collections missed targets by approximately Rs 198-200 billion.
• 🏛️ Government raised PKR 3,549 billion through T-Bill auctions.
• PIB segment saw yield compression, reflecting investor preference for duration.
• 🤝 Auditors M/s. A.F. Ferguson & Co. re-appointed.
• 🛡️ Fund Stability Rating (FSR) at ‘AA- (f)’.
• ⭐ Management Quality Rating (MQR) at ‘AM1’ with a ‘Stable’ outlook.
• 🌐 External buffers strengthened, supporting financial stability.

🎯 Investment Thesis

HOLD. The ABL Government Securities Fund’s underperformance against its benchmark, coupled with a significant increase in AUM, suggests a need for cautious monitoring. The fund’s stability rating and management quality are positive indicators, but the fiscal shortfall in Pakistan and reliance on official inflows pose potential risks. A deeper analysis of the portfolio’s composition and future strategies is warranted before making any changes.