Strength-7

⚡ Flash Summary

NBP Mustahkam Fund – II reported its financial results for the quarter ended September 30, 2025. The fund’s size increased by 2% to Rs. 4,651 million and Rs. 8,721 million for NFTMP-XIX and NFTMP-XVA, respectively. The unit price also experienced growth, leading to returns of 9.8% p.a. and 10.1% p.a. as compared to its benchmark return of 13.2% p.a. and 11.0% p.a. The fund maintains its investment strategy in fixed-income instruments to provide potentially higher returns.

📌 Key Takeaways

• 📈 **Fund Size Growth:** NBP Mustahkam Fund – II’s size increased by 2% for both NFTMP-XIX and NFTMP-XVA.
• 💰 **Asset Under Management (AUM):** NFTMP-XIX reached Rs. 4,651 million and NFTMP-XVA reached Rs. 8,721 million.
• 📊 **Unit Price Appreciation:** The unit price increased, reflecting positive market performance.
• ⭐ **Return on Investment (ROI):** NFTMP-XIX showed a return of 9.8% p.a.
• ✔ **Benchmark Comparison:** NFTMP-XIX benchmark return was 13.2% p.a.
• 💹 **Return on Investment (ROI):** NFTMP-XVA showed a return of 10.1% p.a.
• ✔ **Benchmark Comparison:** NFTMP-XVA benchmark return was 11.0% p.a.
• 🎯 **Investment Strategy:** Primarily invests in Fixed Income instruments for specific duration.
• 🏛️ **Government Securities:** The plan strategically invests in government securities aligned with the plan’s maturity.
• 📜 **Total Income (NFTMP-XIX):** NFTMP-XIX earned a total income of Rs. 117 million during the period.
• ➖ **Total Expenses (NFTMP-XIX):** NFTMP-XIX experienced total expenses of Rs. 5 million.
• 📜 **Net Income (NFTMP-XIX):** NFTMP-XIX net income totaled Rs. 112 million.
• 📜 **Total Income (NFTMP-XVA):** NFTMP-XVA earned a total income of Rs. 224 million during the period.
• ➖ **Total Expenses (NFTMP-XVA):** NFTMP-XVA experienced total expenses of Rs. 7 million.
• 📜 **Net Income (NFTMP-XVA):** NFTMP-XVA net income totaled Rs. 217 million.

🎯 Investment Thesis

Given the fund’s growth, consistent performance, and focus on fixed-income, a HOLD recommendation is appropriate. While the returns are below the benchmark, the fund provides a stable investment option. If the fund performance improves and meets or exceeds its benchmark, a BUY recommendation might be warranted. Continue to HOLD the NBP Mustahkam fund to allow the fund managers time to correct any portfolio issues. A potential price target is difficult to quantify without more granular information. Re-evaluate in Q1 2026.

⚡ Flash Summary

NBP Stock Fund (NSF) has shown significant growth, increasing in size from PKR 39.981 billion to PKR 54.790 billion, a 37.0% increase, for the quarter ended September 30, 2025. The unit price of NSF also increased from PKR 32.2889 to PKR 42.8392, representing a 32.7% increase, while the benchmark rose by 34.9%, underperforming the benchmark by 2.2%. The fund’s NAV has increased by 1,965.2% since its inception on January 19, 2007, demonstrating strong long-term performance. The fund’s performance remains strong, driven by strategic asset allocation and effective management of expenses.

📌 Key Takeaways

• 📈 NSF’s fund size grew by 37.0%, from PKR 39.981 billion to PKR 54.790 billion.
• 💰 Unit price increased by 32.7%, from PKR 32.2889 to PKR 42.8392.
• 📉 The fund underperformed its benchmark by 2.2% during the quarter.
• 🚀 Since inception, the fund’s NAV increased by 1,965.2%.
• 📊 The stock market showed a strong rally, increasing by 32%.
• 🏦 The rally was led by Commercial Banks, Cement, Oil & Gas Exploration, Fertilizer, and Power Generation sectors.
• Inflation averaged 4.2% during the quarter, down from 9.2% last year.
• 💸 Foreign exchange reserves remained stable at USD 14.4 billion.
• 🤝 IMF’s Extended Fund Facility (EFF) second review concluded.
• 🌱 Government revised FY25 GDP growth upwards from 2.68% to 3.04%.
• 🏭 Industrial sector growth reached 19.9% in 4QFY25.
• 💼 Mutual funds, individuals, and companies were significant net buyers.
• 💸 The fund earned a total income of PKR 13,590.86 million during the period.
• 🧾 Net income after expenses was PKR 13,137.46 million.

🎯 Investment Thesis

Based on the fund’s growth, solid long-term performance, and strategic asset allocation, a HOLD recommendation is appropriate. The underperformance against the benchmark is a concern, but the fund’s overall financial health and potential for future growth warrant maintaining the current position. Price target: PKR 45.00 based on continued market growth and improved stock selection. Time horizon: Medium Term