fund manager report - awt investments · the month kicked o˜ with the announcement of the cpi...

FOR THE MONTH JUNE 2016

FUND MANAGER REPORT

Fund Manager Report - June 2016

CEO Comment

2 of 13 MUFAP’s recommended format

“This publication is for informational purposes only and nothing herein should be construed as a solicitation, recommendation or an o�er to buy or sell any fund. All investments in mutual funds are subject to market risks. Past performance is not necessarily indicative of future results. Please read the O�ering Document to understand the investment policies and risks involved.”

The market further continued its upward trajectory in June ‘16, as the KSE100 index gained 5% MoM. %). The announcement of reform friend-ly budget and the inclusion of Pakistan in the MSCI Emerging Market index drove helped the index to reach it all time high; however, it was kept in check by volatility infused by the surprise exit of UK from the EU, and selling by domestic mutual funds due to redemptions.

Pakistan has outperformed its Asian peers in terms of market performance, it outperformed Sri Lanka, which fell by 10% (in terms of US$) and Bangladesh, which fell by 3% (in terms of US$). Pakistan also outperformed Vietnam, which was up 10%. Furthermore, MSCI Pakistan Index was up 10% while MSCI Frontier Market (FM) Index was down by 3%.

On the Local Front:The month kicked o� with the announcement of the CPI in�ation for the month of May 2016 clocking in at 3.17% YoY, which was above our expectations. Decline in food index (as prices of perishable food item declined by ~11%) and transport index (down by 4.25%) contributed to fall in in�ation. Increase in prices was witnessed in Housing, Health, and Education index but they contribute less towards the CPI basket. We expect the in�ation to slightly increase in the coming months due to the Ramadan and Eid Factor.

Earlier in the month, the Government announced its Budget for FY17 with focus on export oriented sectors and the agriculture sector. Incen-tives were also provided for the fertilizer sector to clear the ongoing supply glut. Furthermore, higher allocation towards infrastructure projects is expected to lead to higher demand for construction materials.

Pakistan macroeconomic indicators continue to show improvement. A stable exchange rate, rising foreign exchange reserves, low current account de�cit and low in�ation rate are leading indicators for a better economic environment. Recently the State Bank of Pakistan (SBP) had cut the policy rate by 25 basis points in the outgoing quarter, as per our expectations, to 5.75%. Going forward, we believe that there is an expectation of a further 25 basis point cut in the second half of the Calendar year.

On the international front:The global equity markets witnessed a mixed trend in the outgoing month amid Brexit which had infused volatility and uncertainty around the globe in all Asset classes. The Dow Jones and S&P 500 recorded a return of 0.80% and 0.18% respectively, Stoxx Europe 600 slumped by -4.83%, while the Shanghai Composite bounced by 3.90%.

Crude oil prices (WTI) showed signs of stability during the month but ended the month in the red mainly due to the uncertainties linked with Brexit. WTI prices registered a decline of -1.57% in month of June.

Key factors to monitor in the short term:The major factors that will in�uence the capital markets in the near term include 1) the pace of Economic recovery, 2) the domestic Political Scenario and 3) the result season.

We believe it’s our responsibility to help investors of all sizes, to succeed in the New World of Investing. We were built to provide the global market insight, breadth of capabilities, unbiased investment advice and deep risk management expertise these times require. Investing with PRIMUS gives you access to every asset class and investment style, as well as extensive market intelligence and risk analysis, to help build the dynamic, diverse portfolios �exible with the changing times.

When you invest with PRIMUS, you invest with con�dence. We believe in a disciplined and methodical approach to investing. It is the founda-tion of everything we do and the best way to create long term value for investors. PRIMUS is one of the top mutual fund companies in Pakistan whose strength and credibility have made it one of the most respected �nancial institutions.

We will do our best to re�ect all this in positioning the savings and investments you have entrusted to us to manage. We will be emphasizing the importance of economic growth and work very hard to identify opportunities that remain attractive. We will seek to navigate this environ-ment for you by maintaining a higher degree of operational agility and a solid dose of resilience.


Key Economic Indicators



n.a.=Not AvailableSource: SBP, MoF, PBS

External Sector IndicatorsOverall Balance of Payments USD million Current Account Balance USD million Exports USD million Imports USD million Worker's Remittances USD million Foreign Direct Investment USD million 90 97 Foreign Portfolio Investment USD million 43 56 Forex Reserves USD billion Exchange Rate against PKRUSD Period End Inflation IndicatorsGeneral CPI YoY changeFood CPI YoY changeCore (NFNE) YoY changeCore (Trimmed) YoY changeInterest RatesSBP Policy Rate Current6 Month KIBOR Month Avg.12 Month KIBOR Month Avg.3 Month T-Bill Yield Month Avg.6 Month T-Bill Yield Month Avg.12 Month T-Bill Yield Month Avg.10 Year PIB Yield Month Avg.

(1,244) 411 1 (621) 415306 (416) (216) (279) (610)

1,732 1,729 1,662 1,788 1,7723,485 3,926 3,917 3,843 3,5091,776 1,540 1,592 1,637 1,463

135 157 84 24(27) (21) (26) (45) (72)

18.5 19.9 19.82 21.07 21.07

104.36 104.56 105.46 104.80 104.90 104.64

1.30% 1.60% 2.70% 3.20% 3.30% 4.00%-0.10% 0.50% 2.20% 2.70% 2.50% 3.70%3.40% 3.40% 4.00% 4.10% 4.30% 4.50%2.80% 2.80% 2.90% 2.70% 3.00% 3.60%

6.00% 6.00% 6.00% 6.00% 6.00% 6.00%6.81% 6.58% 6.46% 6.52% 6.42% 6.36%7.11% 6.87% 6.76% 6.81% 6.70% 6.66%6.70% 6.42% 6.29% 6.38% 6.21% 6.22%6.71% 6.43% 6.30% 6.39% 6.22% 6.22%6.73% 6.45% 6.33% 6.43% 6.23% 6.22%

Mar-16 Apr-16 May-16 Jun-16

2157

1,7913,3041,516

103 (34)

20.33

104.72 104.74 104.74 104.59

3.90%3.70%4.70%3.80%

6.00%6.36%6.65%6.19%6.20%6.20%8.23%

4.20%4.70%4.40%3.80%

6.00%6.36%6.66%5.98%5.98%6.00%8.18%

3.19%2.30%4.60%3.70%

5.75%6.11%6.42%5.91%5.93%5.96%8.02%

3.17%2.10%4.60%3.60%

5.75%6.31%6.62%6.11%6.14%6.18%8.18%

Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16

(1,047) (267) 274(343) (159) (240)

2,016 1,598 1,8354,394 3,371 3,8231,821 1,664 1,527

(94) 75 (5)

18.2 18.5 18.5

101.9 101.8 102.41

3.20% 1.80% 1.70%3.20% 0.60% 0.40%4.60% 4.10% 4.00%3.80% 2.80% 2.80%

6.50% 6.50% 6.50%6.88% 7.37% 7.06%7.26% 7.04% 7.35%6.86% 6.90% 6.94%6.94% 6.92% 6.94%6.97% 6.95% 6.94%9.79% 9.85% 9.40% 9.34% 9.10% 9.15% 9.10% 8.85% 8.25%

n.a.n.a.n.a.n.a.n.a.n.a.n.a.

21.77

(104)239

1,7423,5941,469

162(502)20.92

253100

1,7223,8721,657

59(35)

20.79

(688)(792)

1,8324,0081,799

644

21.61

Market ReviewFund Manager Report - June 2016

Equity Market Review:

Economic Review and Outlook:



The Pakistan In�ation measured through Consumer Price Index (CPI) for FY16 clocked in at 2.87%, substantially low contrasted with 4.56% YoY averaged in the FY15. Key factors that led to subdued in�ation-ary numbers include fall in petroleum prices and controlled food in�ation. CPI in�ation General increased by 3.19% on year-on-year basis in June 2016 as compared to an increase of 3.17% in the previous month and 3.2% in June 2015. On month-on-month basis, it increased by 0.64% in June 2016 as compared to decrease of 0.2% in the previous month and an increase of 0.6% in June 2015. SPI in�ation on YoY increased by 0.7% in June 2016 as compared to an increase of 0.6% a month earlier and increase of 1.1 % in June 2015. On MoM basis, it increased by 1.1% in June 2016 as compared to a decrease of 1.0% a month earlier and an increase of 1.0% in June,2015. MoM Increase in CPI is mainly attributable to rise in perishablefoods items (up ~8% MoM) while on YoY basis, the prices of perishable food items declined but non-perishable food items,tobacco, clothing, Housing, Water, Electricity, Gas & Fuels, and education witnessed increase. Decline in prices of perishable food items and transport index resulted in in�ation to stay well within range on YoY basis during FY16.

External balance for the month of May painted a bleak picture with Current Account recording massive de�cit of USD792mn vs. a revised surplus of USD23mn in Apr2016, re�ecting the impact of higher oil prices and machinery imports. Nevertheless, the signi�cant surplus of USD688mn in Financial Account on the back of receipts from multi-lateral agencies, took the May16 BOP to a surplus of USD688mn. It takes 11MFY16 BOP surplus to USD1, 580mn compared to a surplus of USD1, 599mn in the corresponding period.

The foreign exchange reserves increased by USD ~500mln during June 2016 – stood at USD 21.8bln as of 24th June, 2016. Going forward, the foreign exchange reserves of the country are expected to remain stable, supported by in�ows from foreign investment and multilateral agencies.

Lauding the economic performance of Pakistan, the IMF accorded approval to the 11th review for Pakistan with the disbursement of 2nd last tranche of USD501mn loan of IMF’s ExtendedDuring June 2016, the UK decided to leave European Union (known as BREXIT) which resulted in fear of slowdown in global growth in future. Out of total Pakistan exports of USD 6.2bln to European Union, ~25% represents exports to UK. Moreover, total exports and remittances from UK contributes ~USD 4.1bln to our current account. Nonetheless, owing to strong fundamentals of Pakistan’s economy, we expect the negative impact of BREXIT on our GDP growth is very negligible. Fund Facility (EFF), where Pakistan remained broadly compliant with the IMF’s qualitative and quantitative conditions.

Going forward, we believe the economy to �ourish mainly on the back of expected arrival of the CPEC investment. Moreover, increase in the forex reserves, stable currency parity along with the favorable discount rate scenario will likely boost up the economy in the year FY17. On �scal front, FY17 poses challenges as well – pertaining to debt retirement of ~PKR1.6tn and any adverse impact of foreign �ows post IMF program.

During the outgoing month of June’16, KSE100 posted a return of 5% or in other words gained 1,722 points as compared to a return of 3.9%MoM during May’16. This takes FY16 return to 9.8% (FY15: 16%). During June16, average daily turnover (ADT) declined by 36%MoM to 173mn shares while average daily traded value (ADTV) also fell by 9%MoM to USD97mn.

Although the stock market gained ~2,500 points (up 6.9%MTD) till Jun15’16 majorly after positive sentiments created by reclassi�cation of Pakistan into MSCI EM, however, the Brexit event adversely dented the positive sentiment – resulting in negative performance of 776 points (down 2.0%) during second half of Jun’16.

The month ended with two major events 1) MSCI reclassi�es Pakistan as an Emerging Market and 2) Britain decides to exit EU. Pakistan will �nd its place in MSCI EM Index after a hiatus of 8 years when it was booted out from the MSCI EM following imposition of proxy capital control and freeze on market prices. The reclassi�cation is likely to inject signi�cant net foreign �ows (of around USD`700-800mn) and gave the much needed boost to the Equity market.

The main factors that led to rise in benchmark return include i) stabilized crude oil prices in the int’l market (in the range of ~USD 50/bbl), and ii) inclusion of Pakistan in MSCI EM Index. Foreign investors remained net seller in the month under review (net out�ow USD ~2.1mln – excluding one‐time in�ow of USD76mn on Jun8’16) compared to net in�ow of USD3.6mn in the preceding month. The stock market witnessed net in�ows of USD22.1mn till Jun17’16 (after inclusion of Pakistan in MSCI EM) and then witnessed net out�ow of USD 24.2mln post Brexit.

During the month of June’16, the outperforming sectors include Tobacco (up 15%MoM), Pharma (up ~10%MoM), Electrical goods (up ~9%MoM), and Banking sector (up ~8%MoM). Oil & Gas Exploration Companies continued their positive performance during the month (up ~3.3%MoM) on account of rising trend in WTI prices. On the �ip side, the performance of textile sector and insurance sector remained lackluster due to fear of adverse impact of Brexit on textile exports and negative budget FY17 measures on Insurance sector.

The Britain deciding to exit EU following referendum on 24th Jun-146, of which the immediate e�ect was $2 trillion in value wiped from global equity market, while money was directed into safe-haven gold and government bonds. Sterling su�ered massive downfall. The blow to investor con�dence and the uncertainty surrounding the vote has sparked that could keep the Federal Reserve from raising interest rates as planned this year, and even spark a new round of emergency policy easing from major central banks. Also, the Brexit outcome led to signi�cant rise in the Japanese Yen and Gold.

The UK decision to exit European Union will have profound impact on the global equity market, with global rebalancing act still underway; it is too early to suggest the possible outcome locally. Nonetheless, from the Pakistan’s equity market perspective, Textile and Autos sector are likely to be hit hard by the outcome as Pakistan’s Exports to UK is around 7% and the GSP status will likely be revoked. With the Yen up by ~5% vs. USD, is likely to have negative impact on Autos.

Going forward, the expectations on monetary policy review in July as well as the upcoming result season may drive the stock market.

Market ReviewFund Manager Report - June 2016

Money Market Review and Outlook:


During June 2016, the yield curve has shifted downward substantially across all tenures – 3Yr, 5Yr and 10Yr PKRVs dropped by 33bps, 31bps, and 46bps, respectively. Uncertainty in global capital markets and declining oil prices in the international market post Brexit created some panic in the market – bringing the yields down. The declining yields can also be attributed to MoM decline in in�ation witnessed during May’16 in�ation.

In the two T-Bill auctions held during the month, SBP accepted amount of PKR 331bln against the target of PKR 200bn and maturity of PKR 72.50bn. In the �rst auction, the SBP fetched bids of PKR 394.646bln against the target of PKR 100bln and accepted PKR 137.150bln, with majority of the funds borrowed in 12 months T-Bills – re�ecting market expectations of continuation of declining interest rates. During the �rst auction, cut-o� rates of 3M, 6M, & 12M securities increased by 4-2bps to 5.9463%, 5.9684%, & 6.0048%, respectively. During the second auction, the government raised PKR 194.250bln against the maturity of 28.328bln and target of PKR 100bln. The cut o�-rates declined by 4bps to 5.9017%, 5.9258%, & 5.9598% for 3M, 6M & 12M tenor, respectively.

In the PIB auction held on June 15, 2016, the government fetched bids of PKR 220bln and raised PKR 43.267bln against the target of PKR 50bn and maturity of PKR 2.114bn, with majority of the funds borrowed in 3 years papers. Cut o� yields stood at 6.5492%, 6.9997%, and 8.1804% for 3year, 5year and 10year tenor respectively – declined by 14bps, 9bps, & 9bps respectively. Given higher budgetary requirements of the government, we expect higher / above target borrowing by the government to continue in future as well, mainly via T-Bills. Going forward, we expect further decline in yields owing to substantial liquidity of PKR 1.4tn due in month of July’ 16. This may also expose the market participants to reinvestment risk.


Performance 6.37% 5.83% 7.14% 5.36% 6.83% 5.99% 6.46% 5.81%Benchmark 5.85% 5.87% 5.60% 5.47% 5.43% 5.48% 5.28% 5.28%

5.11%5.27%

5.33%5.06%

The objective of the fund is to generate consistent returns with minimal risk by investing primarily in Government Securities, cash and near cash instruments

Fund Objective

Fund Manager’s Review

Investment Committee Members

Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Khawar Salman

Chief Executive O�cer

Chief Financial O�cer

Chief Investment O�cer

Rida Jiwani Chief Strategy O�cer

Fund Manager

Asif Iqbal

Syeda Rabia Ahmed

Head of Compliance and Risk

Head of Research

Credit Quality of Portfolio (as % of T.A.) May. ‘16

*please note that WWF liability for PRIMUS Daily Reserve Fund till the close of �nancial year ended June 30, 2013 since inception will be borne by the management company*

The scheme has maintained a provision gainst Worker's Welfare Fund's liability to the tune of Rs 9,286,816, if the same were not made the NAV per unit/year to date (YTD) return of the scheme would be higher by Rs. 0.6124/0.58% enhancing the YTD return to 6.58% p.a for details investors are advised to read the Note 10 of the latest Financial Statements of the Scheme.

WWF Disclosure

Fund Performance PIML - DRF

PIML Daily Reserve Fund



Fund Details

Fund Type

Category

Fund Stability Rating

Benchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee Load

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Money Market

AA(f ) by PACRA (29 January 2016)

50% 3 months PKRV + 3 monthsaverage deposit rate of AA &above rated Banks

Management Co. Rating AM3+ by JCR-VIS (04 May 2016)

1st January 2013

Daily (days when Banks are open for business)

4.00 pm

Forward

0.45%

0% (Front-end) 0% (Back-end)

Low Risk

Pakistan Stock Exchange

Leverage Nil

Central Depository Company of Pakistan Ltd.

M.Yousuf Adil Saleem & Co.‘Chartered Accountants’

Mohsin Tayebaly & Co.

Khawar Salman


During the month under review, the fund generated an annualized return of 4.34% against the benchmark return of 5.04%. The fund's exposure in Treasury Bills stood at 18.61% of the net assets while the remaining assets are held as place-ments and saving accounts at commercial banks & DFIs.In FY16 the fund posted an annual return of 6.00% against the benchmark return of 5.39%, denoting an outperformance of 60 bps.

Fund Statistics

* Annualized

Portfolio Allocation (as % of T.A.) May. ‘16

Fund Performance July‘15 Aug.‘15 Sep. ‘15 Oct. ‘15 Nov. ‘15 Dec. ‘15 Jan. ‘16 Feb. ‘16 Mar. ‘16 Apr. ‘16

5.52%5.12%

4.34%5.04%

May. ‘16 Jun. ‘16

Fund returns are calculated NAV with dividends reinvested (excluding sales load)

Period FY13 FY14 FY15 FY16

PDRF* PDRF** Benchmark***FYTD 6.00% 6.00% 5.39%CYTD 5.49% 5.56% 5.19%12M Trailing 6.00% 6.00% 5.40%Since Inception 9.35% 8.42%

0.00%0.00%

7.16%AAR-Since Inception 8.58% 7.37%Last 3Yrs 9.20% 7.20%May'16 5.52% 5.66% 5.12%Jun'16 4.34% 4.43% 5.04%

Performance 9.87% 8.91% 9.58%Benchmark 7.93% 8.43% 7.77%

6.00%5.40%

Net Assets (PKR mn) 1,599.48 NAV per Unit (PKR) 105.47Weighted Average Maturity (days) 11Sharpe Ratio* 0.34Information Ratio 0.47Standard Deviation 0.29%

Placements with BanksPlacements with DFIsT-Bills

Others including receivables (NR)Total

AAA (Government Securities)AAAAA+AAOthers including receivables (NR)Total 100.00%

46.54%0.10%

23.58%28.98%

0.80%

Jun. ‘1611.88%

0.02%36.55%51.32%

0.23%100.00%

Portfolio Allocation (as % of total assets) May. ‘16

Portfolio Allocation (as % of total assets) Jun. ‘16

100.00%

0.00%23.56%46.54%

Cash at Bank 29.10%0.80%

Jun. ‘16

0.00%5.98%

11.88%81.90%

0.24%100.00%

*Simple Annualized **Morning Star***Average of reporting period

Cash29.10%

Placements With Banks

12.43%

Placements With D�is23.30%

Tbills46.54%

Others Including Receivables

0.80%

Placements with DFIs, 5.98%

T-Bills, 11.88%

Cash at Bank, 81.90%

Others including receivables (NR),

0.24%

Performance 14.55% 13.76% 8.71% 12.50% 0.34% 10.27% 13.95% 19.72% 7.88%Benchmark 6.40% 6.41% 6.14% 5.99% 5.92% 5.97% 5.82% 5.78% 5.78%

Period FY13 FY14 FY15

The scheme has maintained a provision gainst Worker's Welfare Fund's liability to the tune of Rs 13,682,057, if the same were not made the NAV per unit/year to date (YTD) return of the scheme would be higher by Rs.0.2917/0.28% enhancing the YTD return to11.99% p.a for details investors are advised to read the Note 10 of the latest Financial Statements of the Scheme.

WWF Disclosure



Top TFCs Holdings (as % of T.A.)Fund Statistics

* Annualized ^Excluding Govt. Securities

Fund Performance PIML -IF

*Simple Annualized **Morning Star***Average of reporting period

PIML Income Fund



Fund Details

Fund Type

Category


Benchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Income Scheme

A+ (f ) by PACRA (21 December 2015)

70% 6 month Kibor & 30% average of 6 month depositrate of 3 banks rated AA- and above

Management Co. Rating

9th August 2012


5.00 pm

Forward

1.00%


Low to Moderate Risk


Leverage Nil


M.Yousuf Adil Saleem & Co.‘Chartered Accountants’


Khawar Salman

The objective of PIML - Income Fund (formerly Primus Cash Fund) is to generate competitive returns by invest-ing in short to long term debt instruments and securities.

Fund Objective



During the month under review, the fund generated an annualized return of 12.70% against the benchmark return of 5.56%, signi�-cantly outperforming the benchmark by 7.14%. The fund's exposure in PIBs was further reduced to 20.53% of the net assets as compared to 40.15% of the net assets in the prevailing month. Simultaneously, exposure was increased in Placements & Term Deposits in order to generate higher risk-adjusted return. In FY16 the fund posted an annual return of 11.71% against the benchmark return of 5.92%, denoting a signi�cant outperformance of 5.79%.


Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Khawar Salman



Fund Manager

Asif Iqbal

Syeda Rabia Ahmed


Head of Research

Fund Performance July‘15 Aug.‘15 Sep. ‘15 Oct. ‘15 Nov. ‘15 Dec. ‘15 Jan. ‘16 Feb. ‘16 Mar. ‘16

5.76%5.72%

Apr. ‘16

13.43%5.68%

12.70%5.56%

May. ‘16

Note: Category of PIML IF has been changed from money market to income fund w.e.f. 17th April 2014.

PIML-IF* PIML-IF** Benchmark***FYTD 11.71% 11.70% 5.92%CYTD 12.49% 12.88% 5.76%12M Trailing 11.72% 11.72% 5.92%Since Inception 13.47% 11.44% 7.39%AAR-Since Inception 11.35% -

-8.29%

Last 3 Yrs 13.82% 7.92%May'16 13.43% 14.29% 5.68%Jun'16 12.70% 13.46% 5.56%

Performance 8.72% 8.24% 16.96%Benchmark 9.46% 9.46% 8.35%

FY16

11.71%5.92%

Net Assets (PKR mn) 4,892.51 NAV per Unit (PKR) 102.94^Weighted Average Maturity (days) 103Sharpe Ratio* 4.33Information Ratio 0.34Standard Deviation 1.34%

BAFL TFC-V 20-Feb-13 - 20-Feb-21AKBL TFC-IV 23-Dec-11 - 23-Dec-21

Placements with BanksPlacements with DFIsCommercial PaperTFCs / SukuksPIBs

Cash at BankOthers including receivables (NR)Total 100.00% 100.00%

16.67%

1.20%3.17%

39.85%T-Bills

9.09%

1.45%26.66%

1.91%

Jun. ‘16

21.97%

1.59%5.07%

20.06%

11.98%

1.92%15.99%21.42%



Credit Quality of Portfolio (as % of T.A.) May. ‘16AAA (Government Securities)AAAAA+AA

Others including receivables (NR)Total 100.00%

52.32%0.00%6.83%0.00%

26.42%

AA- 3.40%A+ 9.76%AA-

0.00%1.27%

Jun. ‘1621.98%

0.00%17.06%0.17%

21.42%

4.18%11.98%10.74%12.47%

100.00%

June. ‘16

2.66%1.52%

HPL Sukuk 0.39%TPL Sukuk 0.50%

AM3+ by JCR-VIS (04 May 2016)

Jun. ‘16

Placements With Banks, 21.97%

Placements with DFIs, 11.98%

TFCs/Sukuks, 5.07%

PIBs, 20.06%

T-Bills, 1.92%

Commercial Papers, 1.59%



21.42%

LOP 600,000,000 - 600,000,000 10.00% 11.98% 12.26%

Limit % of Gross Asset

% of Net Asset

Name of Non-CompliantInvestment

Pak Brunei Investment Company

TDR 500,000,000 - 500,000,000 10.00% 9.99% 10.22%Silk Bank

* Note: The non-compliance is due to a redemption.

Type of Investment

Value of Investment Before Provisioning

Value of Investment After Provisioning

Provisioningheld (if any)

TDR 600,000,000 - 600,000,000 10.00% 11.98% 12.26%JS Bank Ltd

Fund returns are calculated NAV to NAV with dividends reinvested (excluding sales load)

Performance 2.05% -0.07% -4.54% 4.20% -4.37% 2.44% 0.02% -1.49%Benchmark 2.78% -1.77% -4.45% 4.17% -3.67% 1.33% -2.91% 0.31%

5.14%4.07%

KSE 100 index, 3 month PKRV and Daily Closing Pakistan Rupee Spot Gold Prices at the Pakistan Mercantile Exchange Limited (PMEX) based on the weighted average exposure of the scheme to eqquity, debt and gold future contracts during the period under review

The scheme has maintained a provision gainst Worker's

Welfare Fund's liability to the tune of Rs 1,311,997, if the same

were not made the NAV per unit/year to date (YTD) return of

the scheme would be higher by Rs. 0.4356/0.42% enhancing

the YTD return to 7.24% p.a for details investors are advised to

read the Note 11 of the latest Financial Statements of the

Scheme.

WWF Disclosure

3M PKRV yield used as Risk‐Free rate. * Annualized

**R‐Square measures the correlation between the benchmark and the funds return

Fund Statistics

Top 10 Equty Holdings (as % of T.A.) Symbol Jun. ‘16

Fund Performance PIML - SMAF

The objective of PIML-SMAF, an open-end balanced scheme, is o�ering retail and institutional clients a product that aims to maximize return and minimize risk. For this purpose, a balanced portfolio is created that has an optimal mix of equity, debt securities and commodity.

Fund Objective



PIML Strategic Multi Asset Fund



Fund Details

Fund Type

Category

Performance RankingBenchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Balanced Fund

3 Star by PACRA (30 June 2016)


23rd August 2013


4.00 pm

Forward

2% p.a.


Moderate to High


Leverage Nil


M.Yousuf Adil Saleem & Co. ‘Chartered Accountants’


Haris Saeed Khan


During the month under review, the fund generated an absolute return of 2.36% against the benchmark return of 3.32%. The total exposure in equities was increased to 69.99% net assets as compared to 62.25% of the net assets in the prevailing month. In FY16 the fund posted an absolute return of 6.82%.



1.39% -0.02%3.46% 2.78%

2.36%3.32%

Apr. ‘16 May. ‘16

Sector Allocation (as % of T.A.) May. ‘16Credit Quality of Portfolio (as % of T.A.) May. ‘16

Stocks / Equities 61.40%PIBs 3.94%

Cash at Bank 26.64%Others including recievables (NR) 8.02%

Tbills 0.00%

Jun. ‘16

65.45%8.04%

18.22%8.29%

0.00%

Total 100.00% 100.00%

Cement 13.60%Fertilizer 7.68%

Oil & Gas Marketing Companies 5.76%Cable & Electrical Goods 6.24%

Other Sectors 6.26%

Commercial Banks 4.00%Textile Composite 4.32%Automobile Assembler 2.47%Pharmaceuticals 2.12%

Jun. ‘1611.53%7.98%

6.57%

Oil & Gas Exploration Companies 3.44%6.70%Power Generation & Distribution 5.52%6.90%

6.61%

7.28%

4.85%4.63%1.26%1.07%

D.G. Khan Cement Co. Ltd. DGKC 6.13%Pakistan State Oil Co. Ltd. PSO 5.68%

Engro Corp. Ltd. ENGRO 4.29%

Oil & Gas Development Co. OGDC 4.98%Maple Leaf Cement Factory Ltd. MLCF 4.72%

Nishat Mills Ltd. NML 4.10%

Kot Addu Power Co. Ltd. KAPCO 2.94%Hub Power Co. Ltd. HUBC 3.07%

AAA (Government Securities)AAA AA & aboveAA-(NR) (includes equity investments)

3.94%0.66%

25.10%0.89%

69.42%

Jun. ‘16

8.04%0.48%

15.78%1.96%

73.74%Total 100.00% 100.00%

PIML-SMAF* Benchmark**FYTD 6.82% 8.59%CYTD 7.49% 11.21%12M Trailing 6.82% 8.60%Since Inception 50.15% 49.13%AAR-Since Inception 14.95% 13.93%May'16 -0.02% 2.78%Jun'16 2.36% 3.32%

Net Assets (PKR mn) 311.04NAV per Unit (PKR) 103.27Sharpe Ratio* 0.21Standard Deviation* 13.06%Treynor Ratio 0.02Beta 1.17R - Square** 66.19%Value at Risk 1.36%


Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Haris Saeed Khan

Chief Investment O�cer &


Fund Manager

Asif Iqbal

Syeda Rabia Ahmed


Head of Research



Period FY14 FY15

Performance 9.27% 28.64%Benchmark 18.80% 13.40%

FY16

6.82%8.59%

Fund returns are calculated NAV to NAV with dividends reinvested (excluding sales load)AM3+ by JCR-VIS (04 May 2016)

Pak Elektron Ltd. PAEL 7.07%

Fatima Fertilizer Co. Ltd. FATIMA 1.99%

Jun. ‘16

Equity Securities,

65.45%

PIBs, 8.04%


Others including recievables (NR),

8.29%

*GlaxoSmith issued share with respect to spin o� entity Glaxosmithkline Consumer HealthCare Pakistan Limited as per there prior demerger notices which were priced at Rs. 62/- per share in the books. Impact on NAV per unit for PIML SMAF is Rs. 0.1. For investors information purpose.

Performance 1.87% -0.17% -5.42% 5.25% -6.08% 3.24% -0.16% -2.75% 7.28%Benchmark 2.24% -1.23% -6.48% 6.06% -6.76% 3.97% -3.18% -0.15% 8.30%


Welfare Fund's liability to the tune of Rs 441,196, if the same


the scheme would be higher by Rs. 0.2201/0.17% enhancing

the YTD return to 7.47% p.a for details investors are advised to

read the Note 10.1 of the latest Financial Statements of the

Scheme.

WWF Disclosure

Portfolio Allocation (as % of T.A.) Jun. ‘16Sector Allocation (as % of T.A.) Jun. ‘16


Credit Quality of Portfolio (as % of T.A.) Jun. ‘16



Fund Statistics

The objective of PIML-IEF is to achieve long term capital growth by investing mainly in Shariah Compliant listed equity securities.

Fund Objective



PIML Islamic Equity Fund



Fund Details

Fund Type

Category

Performance Ranking

Benchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Islamic Equity Scheme

4 Star by PACRA(30 June 2016)

KMI - 30 Index


4th March 2014


4.00 pm

Forward

2% p.a.


Moderate to High


Leverage Nil


KPMG Taseer Hadi & Co.


Sadaf Rasheed




1.24%3.98%

0.76%4.51%

2.85%4.58%

Apr. ‘16 May. ‘16

Stocks / Equities 87.33%Cash at Bank 11.01%Others including recievables (NR) 1.66%

May. ‘16

86.17%8.27%5.56%

Total 100.00% 100.00%

Cement 15.38%Power Generation & Distribution 12.82%Fertilizer 11.68%Other Sectors 9.63%Oil & Gas Marketing Companies 9.18%

Cable & Electrical Products 7.58%

Automobile Assembler 3.85%Textile Composite 5.48%

May. ‘16

17.29%7.08%13.51%10.45%8.94%

8.17%Oil & Gas Exploration & Production 8.45% 4.67%

5.00%5.77%


Pakistan State Oil Co. Ltd. PSO 7.19%

D.G. Khan Cement Co. Ltd. DGKC 5.49%Kot Addu Power Co. Ltd KAPCO 5.57%

Maple Leaf Cement Factory Ltd. MLCF 4.87%

Pak Suzuki Motor Co. Ltd. PSMC 2.91%

Oil & Gas Development Co. OGDC 5.68%

AAA 0.04%AA 0.74%A 10.23%

NR (includes equity investments) 88.99%

May. ‘16

0.05%1.44%6.78%

91.73%Total 100.00% 100.00%

Net Assets (PKR mn) 256.01NAV per Unit (PKR) 127.70Sharpe Ratio 0.21Standard Deviation* 15.22%Treynor Ratio 0.04 Beta 0.85 R - Square** 78.32%Value at Risk 1.58%


Fund Performance PIML - IEF

PIML-IEF* Benchmark**FYTD 7.30% 15.53%CYTD 9.30% 18.99%12M Trailing 7.30% 15.53%Since Inception 40.23% 53.52%AAR-Since Inception 15.59% 20.19%May'16 0.76% 4.51%Jun'16 2.85% 4.58%

Period FY14 FY15


FY16

7.30%15.53%



Nishat Mills Ltd NML 4.06%

Hub Power Co. Ltd. HUBC 7.24%

Jun. ‘16

Equity Securities,

87.33%


Others including recievables (NR),

1.66% Pak Elektron Ltd. PAEL 7.58%

Pharmaceuticals 3.08% 5.32%

*GlaxoSmith issued share with respect to spin o� entity Glaxosmithkline Consumer HealthCare Pakistan Limited as per there prior demerger notices which were priced at Rs. 62/- per share in the books. Impact on NAV per unit for PIML IEF is Rs. 0.28. For investors information purpose.

Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Sadaf Rasheed



Asif Iqbal

Syeda Rabia Ahmed


Head of Research



Fund Manager

PerformanceBenchmark




The scheme has maintained a provision gainst Worker's Welfare Fund's liability to the tune of Rs 151,739, if the same were not made the NAV per unit/year to date (YTD) return of the scheme would be higher by Rs. 0.0549/0.05% enhancing the YTD return to 6.31% p.a for details investors are advised to read the Note 9.1 of the latest Financial Statements of the Scheme.

WWF Disclosure

PIML Islamic Income FundFormerly: PIML Islamic Money Market Fund



Note: Category of PIML IIF has been changed from shariah compliant money market to shariah compliant income fund w.e.f. 2nd October 2015.

During the month under review, the fund generated a return of 4.04% compared to its benchmark return of 3.99%, denoting an outperformance of 5 bps. The fund intends to build exposure in shariah compliant instruments / securities and is geared to avail trading opportunities, going forward.

Fund Details

Fund Type

Category


Benchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Islamic Income Scheme

A(f ) by PACRA (22 January 2016)

6 month deposit rate of three A and above ratedIslamic Banks


4th March 2014


5.00 pm

Forward

0.25%


Low to Moderate Risk


Leverage Nil


KPMG Taseer Hadi & Co


Khawar Salman

The investment objective of the fund is to generate competitive risk adjusted returns by investing in short, medium and long-term Shariah Compliant Fixed Income Instruments.

Fund Objective

Portfolio Allocation (as % of T.A.) Jun. ‘16

Fund Statistics

* Annualized

Apr‘15


Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Khawar Salman



Fund Manager

Asif Iqbal

Syeda Rabia Ahmed


Head of Research


Fund Performance

Net Assets (PKR mn) 276.40 NAV per Unit (PKR) 100.04Weighted Average Maturity (days) 1Sharpe Ratio* 0.43 Information Ratio 0.20 Standard Deviation 0.84%

Sukkuks 0.00%Cash at Bank 98.15%Others including receivables (NR) 1.85%

May. ‘16

8.97%88.18%

2.85%Total 100.00% 100.00%

Fund Performance PIML - IIF

*Simple Annualized **Morning Star***Average of reporting period Fund returns are calculated NAV to NAV with dividends reinvested (excluding sales load)

PIML-IIF* PIML-IIF** Benchmark**FYTD 6.26% 6.26% 4.59%CYTD 6.41% 6.51% 4.34%12M Trailing 6.26% 6.26% 4.59%Since Inception 5.87% 5.66% 5.53%AAR-Since Inception 5.60% - 5.75%May’16 5.12% 5.24% 4.43%Jun’16 4.04% 4.12% 3.99%

AA 0.00%AAA 0.04%

AA- 0.00%A 98.11%Others including receivables (NR) 1.85%

May. ‘16

0.00%0.80%

14.30%31.23%54.38%

Total 100.00% 100.00%



Period FY14 FY15


FY16

6.26%4.59%

5.06% 4.47% 11.86% 3.46% 4.51% 5.49% 8.80% 5.52%4.94% 4.91% 4.91% 4.97% 4.47% 4.66% 4.77% 4.24%

8.89%4.06%

July‘15 Aug.‘15 Sep. ‘15 Oct. ‘15 Nov. ‘15 Dec. ‘15 Jan. ‘16 Feb. ‘16 Mar. ‘16

5.43%4.50%

5.12%4.43%

4.04%3.99%

Apr. ‘16 May. ‘16


Jun. ‘16



1.85%


Portfolio Allocation (as % of T.A.) Jun. ‘16


Welfare Fund's liability to the tune of Rs 202,766, if the same


the scheme would be higher by Rs. 0.0950/ 0.09% enhancing

the YTD return to 5.08% p.a.

WWF Disclosure



Fund Statistics Sector Allocation (as % of T.A.) Jun. ‘16


Fund Performance PIML - VEF

The objective of PIML-Value Equity Fund is to achieve long term capital growth by investing mainly in listed equity securities.

Fund Objective



PIML Value Equity Fund



Fund Details

Fund Type

Category

Performance Ranking

Benchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Equity Scheme

N/A

KSE 100 Index


13th March 2015


4.00 pm

Forward

2% p.a.


Moderate to High


Leverage Nil




Sadaf Rasheed



Fund Performance


Stocks / Equities 91.29%Cash at Bank 6.14%Others including recievables (NR) 2.56%

May. ‘16

85.12%7.58%7.30%

Total 100.00% 100.00%

Other Sectors 12.09% 11.34%

Fertilizer

Commercial Banks

Oil & Gas Exploration Companies

Cable & Electrical Goods

Textile CompositePharmaceuticals

11.20%

9.53%

11.81%

7.93%

6.89%2.69%

May. ‘16

11.37%

8.56%Power Generation & Distribution 8.13% 4.58%

7.20%

7.69%

6.56%3.96%

Automobile Assembler 2.06% 3.74%

Kot Addu Power Co. Ltd. KAPCO 4.15%

Hub Power Co. Ltd. HUBC 3.02%National Bank of Pakistan NBP 3.06%

AAA 0.35%AA & above 0.09%AA- 0.69%ANR (includes equity investments)

5.02%93.86%

May. ‘16

0.33%0.09%1.48%5.68%

92.42%Total 100.00% 100.00%

PIML-VEF* Benchmark**FYTD 4.99% 9.84%CYTD 7.60% 15.14%12M Trailing 4.99% 9.84%Since Inception 14.55% 15.96%AAR-Since Inception 10.73% 11.00%May'16 0.12% 3.87%Jun'16 2.14% 4.78%

Net Assets (PKR mn) 234.28NAV per Unit (PKR) 109.79Sharpe Ratio* 0.07Standard Deviation* 14.42%Treynor Ratio 0.01Beta 0.97R - Square** 83.40%Value at Risk 1.50%

Maple Leaf Cement Factory Ltd. MLCF 3.70%


Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Sadaf Rasheed



Asif Iqbal

Syeda Rabia Ahmed


Head of Research



3.33% -0.73% -6.41% 5.57% -5.85% 2.26% -0.85% -2.52%3.90% -2.84% -7.02% 6.11% -5.86% 1.74% -4.62% 0.23%

6.63%5.64%

July‘15 Aug.‘15 Sep. ‘15 Oct. ‘15 Nov. ‘15 Dec. ‘15 Jan. ‘16 Feb. ‘16 Mar. ‘16

2.08%4.77%

0.12%3.87%

2.14%4.78%

Apr. ‘16 May. ‘16 Period FY15

Performance 9.11%Benchmark 4.64%

FY16

4.99%9.84%



Pak Elektron Ltd. PAEL 7.93%Oil & Gas Development Co. OGDC 8.12%


Nishat Mills Ltd. NML 5.64%Pakistan State Oil Co. Ltd. PSO 5.48%

D.G. Khan Cement Co. Ltd. DGKC 4.00%

Jun. ‘16

Equity Securities,

91.29%

Cash at Bank, 6.14%

Others including

recievables (NR), 2.56%

Cement 11.08% 17.29%

Oil & Gas Marketing Companies 7.67% 6.39%

*GlaxoSmith issued share with respect to spin o� entity Glaxosmithkline Consumer HealthCare Pakistan Limited as per there prior demerger notices which were priced at Rs. 62/- per share in the books. Impact on NAV per unit for PIML VEF is Rs. 0.23. For investors information purpose.

Fund Manager


Weighted average of 6-month KIBOR and KSE-100 index as per amount invested in equities and �xed income investments including cash & cash equivalent respectively

Fund Performance PIML - AAF

The investment objective of this fund is to earn competitive returns by investing in the various asset classes / instruments based on the market outlook.



PIML Asset Allocation Fund



Fund Details

Fund Type

Category

Performance RankingBenchmark

Inception Date

Dealing Days

Cut-o� Time

Pricing Mechanism

Management Fee

Load

Risk Pro�le

Listing

Trustee

Auditor

Legal Advisor

Fund Manager

Open End

Asset Allocation

Not Available


12th April 2016


4.30 pm

Forward

2% p.a.

Front end 3%

Moderate to High


Leverage Nil




Haris Saeed Khan


During the month under review, the fund generated an annualized return of 0.98% compared to its benchmark return of 0.50%, signi�-cantly outperforming its benchmark by 48 bps. The fund's exposure in PIBs was further reduced to 43.28% of the net assets as compared to 68.31% of the net assets in the prevailing month. Simultaneously the fund increased its exposure in placements with banks in order to generate a higer risk adjusted return. The fund is geared to avail any trading opportunities arising in the Equity and Fixed Income Markets.

Portfolio Allocation (as % of T.A.)

Fund Performance

0.98%0.50%

Jun. ‘16

-0.51%0.43%

Apr. ‘16

2.40%0.49%

May. ‘16

Credit Quality of Portfolio (as % of T.A.)

PIBsCash at Bank

Placements with BanksOthers including recievables (NR) 2.45%

27.13%

Total 100.00%

Jun. ‘16

40.80%16.04%

2.53%19.31%

Placements With DFIs 13.57% 0.00%

May. ‘16

67.92%10.25%

100.00%

AAA (Government Securities)AA+ AA A+

A-Other including receivables (NR)

Jun. ‘16

40.82%13.57%0.06%

13.57%2.45%

May. ‘16

81.79%0.00%0.00%

0.00%A

13.57% 10.48%15.98% 0.00%

7.72%Total 100.00%100.00%

PIML-AAF* Benchmark**FYTD 2.87% 1.43%

1.43%

1.43%

CYTD 2.87%

2.87%- -

- -12M TrailingSince InceptionAAR-Since Inception

2.40%May'16 0.49%0.98%Jun'16 0.50%


Ahmed Ateeq

Hamza Saboor

M. Samir Malik, CFA

Haris Saeed Khan



Fund Manager

Asif Iqbal

Syeda Rabia Ahmed


Head of Research



Fund Statistics

* Annualized

Net Assets (PKR mn) 1,389.62

NAV per Unit (PKR) 100.80

0.45Sharpe Ratio*^

4.35%

Information Ratio 0.12

Standard Deviation*^

Fund Objective


^The lookback period is 57 days (Since inception)



Placements With Banks, 27.13%

Placements With DFIs, 13.57%

PIBs, 40.80%


2.45%

LOP 200,000,000 - 200,000,000 10.00% 13.57% 14.39%

Limit % of Gross Asset

% of Net Asset

Name of Non-CompliantInvestment

Pak Brunei Investment Company

TDR 200,000,000 - 200,000,000 10.00% 13.57% 14.39%Silk Bank

* Note: The non-compliance is due to a redemption.

Type of Investment

Value of Investment Before Provisioning

Value of Investment After Provisioning

Provisioningheld (if any)

TDR 200,000,000 - 200,000,000 10.00% 13.57% 14.39%JS Bank Ltd

Tel : (+92-21) 37130165, 35307465Fax: (+92-21) 35290004

A Wholly Owned Subsidiary of Pak Brunei Investment Company Limited

Karachi Head O�ce Address Islamabad O�ce Address Lahore O�ce Address3rd Floor, Horizon Vista Plot No. Commercial 10 Block No.4 Scheme No.5 Clifton Karachi, Pakistan.

Tel : (+92-51) 2800397-8

O�ce No. 11 Executive Business Center,Ground Floor Saudi Park Tower, Jinnah Avenue, Islamabad.

Tel : (+92-42) 35221632-4

First Floor Commercial Plaza, 852-DFaisal Town Akbar Chowk, Lahore.

www.primusinvestments.com

fund manager report - awt investments · the month kicked o˜ with the announcement of the cpi...

Documents