JCR-VIS Credit Rating Company Limited has assigned Management Quality (MQ) rating of 'AM2-'(AM-Two Minus) to National Investment Trust Limited (NITL). Outlook on the assigned rating is 'Stable'. NITL is the oldest asset management company. It also enjoys the largest market share, with rupees 79.8 billion in assets under management at the end of December 2010.
Historically, the company had been managing only one fund, National Investment (Unit) Trust [NI(U)T]. Following the capital market crisis, two equity funds were launched to support equity market, in addition to which, two income funds have also been launched in FY10. Unit holding pattern of NI(U)T is well-diversified.
Fund performance of NI(U)T has lagged behind benchmark and returns posted by other open-end equity funds in FY10 and also in prior periods. About one-tenth of net assets of NI(U)T are frozen, restricting active management ability to that extent. NIT-State Enterprise Fund is invested in a few scrips. It is exempted from sector-wise allocation limits and hence appreciated in CY1O by investing more than half its assets in the oil & gas sector. Returns have subsequently been lower on account of decline in share price of key holding.-PR