mutual funds ver 3

8/10/2019 Mutual Funds Ver 3

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Mutual Funds; The future

of investment in Pakistan?SPONSORED BY: AL MEEZAN INVESTMENT MANAGEMENT LTD.


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Sponsors: Al Meezan Investment Managem

Liaison: Mr. Mohammad Asad (SEVP and Chief investment officer)

Office: 1st Floor, Block C Finance Trade Center, Sharah-e-Faisal, Karachi,74000, Pakistan


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Faculty Support

Advisor: Dr. Mohammad Nishat (Associate Dean, IBA karachi)

Coordinator: Asad Ilyas (Chairperson Accounting and Finance)


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Group Detials


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General Look at the Pakistani

Economy


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Source: Economic watch

GDP (Constant Prices) is PKR 6,240.06 Billion.

GDP Growth (Constant Prices) is 3.505 %.

GDP (Current Prices) is PKR 23,229.79 Billion

GDP Per Capita (Current Prices) is PKR 127,228.00

Inflation (End of Year Change %) is 9.018 %.

Population is 182.584 Million .

Total Government Net Debt is PKR 14,120.37 Billion.


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The 40-44 age bracket was among the most affluent.Pakistan has a substantial mconsisted of 12.3 million hou


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Investment and Saving for Pakistan in2013

Pakistans savings ratio declined steadily during the review period, dropping from 6.0% of dispos

4.7% in 2011.


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In India and Indonesia there is also a younger middle class so there isgreater emphasis on education and technology. Therefore, businessesneed to adopt multiple business strategies for different regions.

There has also been a shift from basic necessities to discretionary items


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Pakistans equity market has been one of the best performing markets ofthe region with a growth of 49% in Calendar year 2013. (Balancing quest -inchingtowards recovery, Mar 2014 )


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About Mutual Funds in Pakistan


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Banking Deposits and GDP

- YoY gro-% of GD

Source: Monetary policy information Compendium 2014


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Financial Stability Review H1-FY13. SBP


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Financial Stability Review H1-FY13. SBP


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93%

5%

2%

Industry-wide - Net Assets


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In Pakistan as per SBP report as atJune 31,2014


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China

India

Japan

Korea, Rep. of

Pakistan

Philippines

Taiwan

TOTAL NET ASSETS IN U.S. DOLLARS

REGIONAL COMPARISON-ASIA REGIONAL COMPARISO


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Source: Industry update by IGI Investment

Asset Manager No. of openFunds

Fund Size as atDec 2013

(in PKR bn)

In

National Investment Trust Limited 3 61.58

Al Meezan Investment Management LTD 12 48.01

National Fullerton Asset Management Ltd 14 41.79

Arif Habib Investment Ltd ( subsidary MCB) 16 39.02

UBL Fund Managers Ltd 19 36.11


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Pakistans mutual funds industry grewat a compound annual growth rateof14.45% from 2004 to 2013.

Net assets grew from PKR 93.82bn in2004 to PKR 335.23bn in 2008.


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The industry has still not grown to itspotential because of the following

challenges.

Lack of awareness of mutual funds among reta

investors and their reluctance invest.

A small distribution network and accessibility to

retail investors. Hardly any advertisements by AMCs can be

seen.

A very small sales force compared to banks.


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The Main Objective/Task

The main objective of this research is to gauthe competitive landscape of the mutual

funds industry in Pakistan and possibleopportunities in the market for mutual funds


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Broad areas of research

Investor preferences Investor awareness Investo

Sharia-compliance Opportunities for banks Customer sa

Trends of mutual funds growth in

Pakistan

Mutual funds vs other investment

avenues

Internati


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Methodology to execute the project

Both qualitative and quantitative methods to be used.

Literature review

Survey of a sample size of at least 200 existing customers (list to beprovided by the company) and 100 prospective Al-Meezan customers( listof such individuals may be available from the companys sales channel)

5 personal in-depth interviews from experts in this field.

2 Focus groups.


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TIMELINE OF ACTIVITIES

October

Background research. We shall focus on understanding the industry dynamics by sifting throughthe product literature from different companies, using MUFAP website, researching on foreignjurisdictions and their behavioral pattern, studying regulatory framework (NBFC).

Project proposal/TOR to be given to the company.

TOR approval by the company.

TOR presentation the client, Mr. Asad Ilyas and Dr. Mohammad Nishat.

November

Literature review.

Focus group 1(Existing Investors)

Focus group 2 (Prospective investors)

Progress report to the company, project coordinator and project advisor.


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December

Transcription and analysis of the focus groups.

Designing the personal interview questionnaire in consultation with the company.

Conducting 1 in-depth interview.

Transcription and analysis of the interview.


January

Conducting 4 in-depth interviews.

Transcription and analysis of the interviews.

Designing survey questionnaires in consultation with the company.

Administering 200 survey questionnaires to existing customers.



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February

Administering 100 survey questionnaires to prospective customers.

Entry of data in SPSS.

Editing, coding and cleaning of data.

Progress report to the company and project advisor.

March

Data analysis.

Recommendations and conclusions.

Interim report submission.

April

Final report submission.(First half)

Final report presentation.(Second half)

mutual funds ver 3

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