Strength-6

⚡ Flash Summary

ABL Cash Fund (ABL-CF) reported its quarterly financial statements for the period ending September 30, 2025. The fund’s annualized return stood at 9.75% against a benchmark return of 10.66%. AUMs of ABL-CF increased substantially to PKR 60,396.55 million at Sep’25, resulting in a growth of 47.11% from PKR 41,055.17 million at the end of June 2025. The fund had 53.04% exposure in T-bills, 0.34% exposure in TFCs/Sukuks, and 45.99% of the exposure was placed in Cash.

📌 Key Takeaways

• 📈 AUM grew by 47.11% reaching PKR 60,396.55 million.
• 📊 Annualized return of the fund was 9.75%, below the benchmark of 10.66%.
• 🏛️ 53.04% of the fund’s assets are invested in T-bills.
• 💼 0.34% of the fund is invested in TFCs/Sukuks.
• 💰 45.99% of the fund’s exposure was allocated to cash.
• 🇵🇰 Pakistan’s economy is building on stabilization momentum, with inflation averaging 4.2% YoY.
• 📉 September CPI accelerated to 5.6% YoY from 3.0% YoY in August.
• 🏦 SBP maintained the policy rate at 11% reflecting confidence in price stability.
• 🏭 Large-scale manufacturing showed tentative signs of recovery.
• 💰 Liquid FX reserves stood close to US$19.8bn by September.
• ⬆️ S&P upgraded Pakistan’s rating in July 2025, followed by Moody’s in August.
• 🌱 YTD AUMs growth in the open-end mutual fund industry was 7.81%.
• 📊 Headline CPI averaged 4.2% YoY during the quarter, down from 9.2% in 1QFY25.
• ⚠️ Inflation initially moderated, but projected to rise to 5.1-7.0% in September.
• ⭐ Management Quality Rating (MQR) of ABL AMC at ‘AM1’ with a ‘Stable’ outlook.

🎯 Investment Thesis

HOLD. The fund’s AUM growth is positive, but the slightly below-benchmark returns warrant a neutral stance. The high allocation to T-bills and cash provides stability but limits potential upside. Active management to improve returns and a closer tracking of the benchmark are needed for a more positive outlook.

⚡ Flash Summary

ABL Islamic Stock Fund (ABLISF) reported its quarterly financial statements for the period ended September 30, 2025. The fund’s AUM increased significantly by 45.83% to PKR 4,568.21 million, compared to PKR 3,132.41 million in the previous quarter. The fund posted a return of 27.79%, underperforming against the benchmark return of 33.20%. The management quality rating was assigned ‘AM1’ by PACRA. The equity market experienced a rally, but recent floods could cause a rise in inflation.

📌 Key Takeaways

• 📈 AUM increased by 45.83% QoQ, reaching PKR 4,568.21 million.
• 📉 Fund return of 27.79% underperformed the benchmark return of 33.20%.
• ⭐ Management Quality Rating (MQR) affirmed at ‘AM1’ by PACRA.
• ✔️ The KMI-30 index saw a rally, rising 33.2% QoQ.
• ✔️ Investor confidence improved due to credit rating upgrades by S&P and Moody’s.
• ✔️ SBP reported a record profit of PKR 2.5 trillion.
• ✔️ The fiscal deficit stood at 5.4% of GDP.
• ✔️ FX reserves averaged USD 14.4 billion.
• ⚠️ Market faced foreign outflows of USD 132 million.
• ⚠️ New fiscal measures included PKR 340 billion in extra taxes and fuel price hikes.
• ⚠️ FBR revenue missed targets by PKR 200 billion.
• ⚠️ Inflation averaged 4.2% YoY.
• ⚠️ Recent floods across the country could contribute to a rise in inflation.

🎯 Investment Thesis

HOLD. The ABL Islamic Stock Fund has demonstrated significant AUM growth, reflecting investor confidence, but the underperformance against its benchmark warrants a hold rating. The potential inflationary pressure could dampen future returns. More analysis is needed.

⚡ Flash Summary

ABL Special Savings Fund (ABL-SSF) reported its quarterly financial statements for the period ending September 30, 2025. The report includes the economic performance review, noting Pakistan’s economy is building on stabilization with inflation trending lower, though some pressures are building in the quarterly trend. Fiscal collections are holding steady, but are missing targets, while remittances continue to provide crucial support. Despite these challenges, market sentiment improved during the quarter, aided by sovereign rating upgrades and proactive debt management.

📌 Key Takeaways

• 📈 Pakistan’s inflation averaged 4.2% YoY, with a September CPI of 5.6% YoY.
• 🏭 Large-scale manufacturing output rose 8.99% YoY in July 2025.
• 💰 FBR collected Rs 2.86 trillion in 1QFY26, falling short of targets by Rs 198-200 billion.
• 📊 Exports totaled US$5.3bn (+10% YoY), while imports were US$10.4bn (+9% YoY).
• 💸 Workers’ remittances stood at US$6.35bn (+7% YoY).
• deficit to US$624mn in the first two months of FY26.
• 💵 Net financial inflows were US$563mn, driven by government borrowings.
• 📉 FDI remained modest at US$323mn (-34% YoY), and portfolio flows showed outflows of US$83mn.
• 🏦 Liquid FX reserves stood near US$19.8bn by September.
• ⬆️ S&P upgraded Pakistan’s rating in July 2025, followed by Moody’s in August.
• 🏦 State Bank of Pakistan (SBP) maintained its policy rate at 11.00% throughout the quarter.
• 💰 AUMs increased by 14.5% in Conventional Income Funds and 4.1% in Conventional Money Market Funds.

🎯 Investment Thesis

HOLD. Given the mixed economic signals (lower inflation but missed fiscal targets) and the fund’s performance (underperforming benchmarks in most plans), a HOLD recommendation is appropriate. While market sentiment improved, vulnerabilities remain. Further monitoring is warranted to assess the sustainability of the economic recovery and the fund’s ability to deliver competitive returns.