The Pakistan Credit Rating Agency (Pacra) has upgraded the asset manager rating of Dawood Capital Management Limited (DCML) to 'AM3-' (AM Three Minus) [Previous: AM4+]. The rating denotes high investment management industry standards and benchmarks.
The rating reflects DCML's experienced management team and adequately structured investment process, adequately taking care of relatively small, though expanding, size of funds and scale of operations. However, unit holder concentration in AUM is still high. The company has taken various steps to improve efficacy of business functions such as research and investor services platform by deploying requisite resources.
Moreover, DCML has enhanced the quality of its decision making framework with expanded investment committee and representation of related functions on IC. At the same time, DCML has achieved operational break-even, attributed to cost rationalisation and relative improvements in assets under management and lately funds' performance. This is expected to provide financial space to establish its distribution network and further strengthen overall operational framework.
The rating is dependent on effective execution of DCML's business plan to ensure consistent growth in AUMs, enabling the company to upgrade its system and controls in a consistent manner. Moreover, sustainability in the underlying performance of funds remains critical.-PR
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