⚡ Flash Summary

ABL Income Fund (ABL-IF) reported its unaudited financial statements for the quarter ended September 30, 2025. The fund posted an annualized return of 9.94% against a benchmark return of 10.57%. The AUM decreased by 5.58% to PKR 3,845.80 million from June 2025. The Fund had significant exposure to cash (44.04%), TFCs (16.65%), and T-Bills (23.84%). The management company has been assigned a quality rating of ‘AM1’ by PACRA.

📌 Key Takeaways

• 📉 AUMs decreased by 5.58%, closing at PKR 3,845.80 million compared to PKR 4,073.42 million in June 2025.
• 📊 Annualized return of 9.94% underperformed the benchmark return of 10.57%.
• 💰 Significant cash holdings at 44.04% of the fund’s exposure.
• 💼 16.65% exposure in Term Finance Certificates (TFCs).
• 📈 4.77% allocation to Pakistan Investment Bonds (PIBs).
• 📜 23.84% investment in Treasury Bills (T-Bills).
• 🛡️ 7.84% held in Government Guaranteed Securities.
• 🏦 Monetary Policy maintained the policy rate at 11.00%.
• ⬆️ Headline CPI rose to 4.06% YoY in July, then eased to 3.0% YoY in August.
• 🌱 Large-scale manufacturing showed tentative signs of recovery with 8.99% YoY growth in July.
• ⚠️ Fiscal collections missed the quarterly target by approximately Rs 198-200 billion.
• 🌍 External account saw exports totaling US$5.3 billion and imports at US$10.4 billion, resulting in a goods deficit of US$5.1 billion.
• ➡️ The Fund Stability Rating (FSR) for ABL IF is ‘A+ (f)’ by PACRA.
• 🏢 ABL Asset Management Company’s (ABL AMC) Management Quality Rating (MQR) is ‘AM1’ by PACRA with a ‘Stable’ outlook.

🎯 Investment Thesis

Given the fund’s underperformance, decrease in AUM, and the missed fiscal target in Pakistan which increases economic fragility, the recommendation is HOLD. The fund has significant cash holdings and liquid assets, but higher expenses and decreased revenues create uncertainty.