Signal: BUY

⚡ Flash Summary

NBP Balanced Fund (NBF) reported a substantial 25.7% increase in fund size, growing from Rs. 1,470 million to Rs. 1,848 million for the quarter ended September 30, 2025. The unit price of NBF increased by 22.6%, outperforming its benchmark by 1.6%. The Fund’s NAV has seen a significant increase of 1399.5% since its inception. The stock market sustained its upward trend, delivering a strong 32% return during the quarter, contributing to the Fund’s performance.

📌 Key Takeaways

• 📈 Fund size increased by 25.7%, reaching Rs. 1,848 million.
• 💰 Unit price grew by 22.6%, outperforming the benchmark’s 21.0%.
• 🚀 NAV increased by 1399.5% since inception, beating the benchmark by 440.7%.
• 💹 Stock market delivered a strong 32% return during the quarter.
• 📊 Inflation averaged 4.2% during the quarter, down from 9.2% year-over-year.
• 📉 Core inflation eased to 7.3%, indicating a moderation trend.
• 🌐 Current account deficit widened to USD 624 million during 2MFY26.
• 💸 Remittances grew by 8.4% YoY during 1QFY26.
• 🏦 Foreign exchange reserves remained stable at USD 14.4 billion.
• 🤝 IMF’s second review under EFF concluded, unlocking USD 1.2 billion in assistance.
• 🌱 FY25 GDP growth revised upward to 3.04% from 2.68%.
• 🏢 Industrial sector growth led with 19.9% in 4QFY25.
• 📊 NBP Balanced Fund earned a total income of Rs. 354.11 million during the period.
• ✅ Net income is Rs. 338.92 million after deducting total expenses of Rs. 15.19 million.

🎯 Investment Thesis

Based on its strong performance, substantial growth, and outperformance against its benchmark, NBP Balanced Fund is a BUY. The fund’s effective management and robust asset allocation strategy make it an attractive investment. However, investors should monitor the fund’s risk profile, including non-compliant investments and broader market risks. A price target of Rs. 45.00 with a medium-term horizon (6-12 months) is justified based on continued market momentum and effective fund management.

⚡ Flash Summary

NBP Financial Sector Fund (NFSF) reported a strong performance for the quarter ended September 30, 2025. The fund’s size increased significantly from Rs. 325 million to Rs. 953 million, representing a 193.2% increase. The unit price of NFSF rose from Rs 15.7174 on June 30, 2025, to Rs 22.9002 on September 30, 2025, indicating a 45.7% increase, outperforming its benchmark by 10.8% during the period. The fund earned a total income of Rs. 229.28 million and, after deducting expenses, the net income stood at Rs. 221.13 million.

📌 Key Takeaways

• 📈 Fund size increased by 193.2%, from Rs. 325 million to Rs. 953 million.
• 💰 Unit price surged by 45.7%, from Rs. 15.7174 to Rs. 22.9002.
• 🏆 The Fund outperformed its benchmark by 10.8% during the quarter.
• 💹 KSE-100 Index soared to a record 165,494 points, reflecting a strong market rally.
• 🏦 The rally was broad-based, led by Commercial Banks, Cement, Oil & Gas, Fertilizer, and Power Generation sectors.
• 📉 Inflation averaged 4.2%, down from 9.2% YoY, indicating a moderation trend.
• 💲 Current account deficit widened to USD 624 million during 2MFY26.
• ✉️ Remittances grew by 8.4% YoY during the quarter.
• 💵 Foreign exchange reserves remained stable at USD 14.4 billion.
• 🤝 IMF agreement unlocked USD 1.2 billion in financial assistance.
• 🌱 FY25 GDP growth revised upward to 3.04%.
• 💼 Mutual Funds, Individuals, and Companies emerged as the largest net buyers.
• 💸 The fund earned a total income of Rs. 229.28 million.
• ✅ Net income after expenses was Rs. 221.13 million.

🎯 Investment Thesis

We recommend a BUY rating for NBP Financial Sector Fund. The fund has demonstrated strong performance, significant growth, and superior stock selection. The favorable macroeconomic conditions, including decreasing inflation and potential monetary easing, provide a conducive environment for further growth. The fund’s focus on the financial sector positions it well to benefit from the expected growth in the industrial and services sectors. The price target is Rs. 25.50 within the next 12 months, based on continued outperformance and growth in the financial sector.

⚡ Flash Summary

NBP Sarmaya Izafa Fund (NSIF) reported an increase in fund size from Rs. 759 million to Rs. 981 million during the quarter ended September 30, 2025, representing a growth of 29.0%. The unit price increased by 30.4%, outperforming its benchmark by 0.1%. Since its inception, the fund has shown an impressive increase of 1208.3%, significantly outperforming its benchmark by 316%. The fund’s total income was reported as Rs. 237.77 million, with a net income of Rs. 228.82 million after deducting expenses.

📌 Key Takeaways

• 📈 Fund size increased by 29.0%, reaching Rs. 981 million.
• 💰 Unit price rose by 30.4%, from Rs. 29.7753 to Rs. 38.8307.
• 🥇 Outperformed benchmark by 0.1% during the quarter.
• 🚀 Since inception, the fund’s NAV increased by 1208.3%.
• 💹 Outperformed benchmark by 316% since inception.
• 📊 Stock market delivered a strong 32% return in 1QFY26.
• 📉 Inflation averaged 4.2% during the quarter, down from 9.2% a year earlier.
• 🌍 Current account deficit widened to USD 624 million during 2MFY26.
• 💸 Remittances grew by 8.4% YoY during 1QFY26.
• 🏦 FX reserves remained stable at USD 14.4 billion as of September 26, 2025.
• 🤝 IMF Staff-Level Agreement will unlock around USD 1.2 billion in financial assistance.
• 🌱 Government revised FY25 GDP growth upward to 3.04%.
• 🏦 Commercial Banks, Cement, Oil & Gas Exploration sectors led market gains.
• 💼 Mutual Funds, Individuals, and Companies emerged as the largest net buyers.

🎯 Investment Thesis

Based on the fund’s strong performance, outperformance of its benchmark, and alignment with high-performing sectors, a BUY recommendation is warranted. The fund’s ability to generate consistent returns and manage expenses effectively makes it an attractive investment option. The positive outlook for GDP growth and potential for further financial assistance from the IMF further support a bullish outlook. However, investors should carefully consider the risks associated with macroeconomic factors and sector-specific challenges.