The Pakistan Credit Rating Agency (Pacra) has assigned the asset manager rating of 'AM3' to Dawood Capital Management Limited (DCM). The rating reflects the company's strong capacity to manage the risks inherent in asset management and the asset manager meets high investment management industry standards and benchmarks.
The company's strong capacity emanates from a well-qualified and experienced management team, association with a strong and expanding business group, adequate risk management policies, and reasonable supporting systems. Although the number of funds and assets under management has increased, the size and diversity still remains limited. Meanwhile, the rating also recognises the management's well-conceived business plan of focusing on small retail investors through offering innovative products and following a distinctive marketing strategy.
However, as the implementation of this strategy is at an initial stage, the impact thereof on business expansion and the related timeline remain to be seen.
DCM was incorporated in 1993 as a venture capital company, and listed on Karachi Stock Exchange. The company was acquired by First Dawood Group in 1999. During 2003, the company changed its objective to undertake asset management and investment advisory business, and subsequently also changed its name to Dawood Capital Management Limited (DCM).
The sponsoring group is a branch of the reputed Dawood family, which is one of the leading business groups in Pakistan. The combined effective holding of the Group in the company is around 60 percent. Apart from First Dawood Investment Bank (FDIB), the sponsoring group also operates two leasing modarabas, and is further diversifying its operations through joint venture arrangements by setting up an Islamic Bank, Takaful Insurance and wind power generation project.
The Asian Development Bank (ADB) has a 12.5 percent holding in DCM, and also has a representation on the BoD through a nominee director. The CEO of DCM, Ms T Uzra Dawood, has done her Doctorate in Juridical Science from Harvard Law School, and is holding this office since April 4.