Karachi: The Meezan Sovereign Fund (MSF), an open-end sovereign mutual fund categorized under Income Funds, has reported a remarkable annual return of 21.89% for the fiscal year ending June 30, 2024, outperforming its benchmark which posted an 18.95% return.

According to information available from the Pakistan Stock Exchange (PSX), the fund's primary aim is to provide investors with a stable and low-risk income, mainly through investments in Shariah-compliant sovereign securities. As of the latest financial year, at least 70% of the fund's net assets were invested in Islamic government bonds and sovereign Sukuks, with a minimum of 10% held in cash to ensure liquidity, and the remainder allocated to various permissible Islamic investment options.

For the year ending June 30, 2024, MSF's asset allocation included significant investments in Ijarah Sukuks and deposits at Islamic banks. The fund achieved a gross income of Rs. 9,742 million, primarily from profits on Sukuks amounting to Rs. 7,975 million, and earnings from Islamic savings accounts contributing an additional Rs. 1,769 million.

Despite a realized loss of Rs. 58 million, the fund managed an accrued unrealized gain of Rs. 55 million. After accounting for expenses totaling Rs. 555 million, the net income stood at Rs. 9,187 million. This financial activity propelled the fund's net assets to Rs. 58,055 million by June 30, 2024—a significant increase from Rs. 8,133 million in the previous year, marking a 614% growth.

The net asset value per unit also saw a slight increase from Rs. 52.1375 to Rs. 52.3857 over the same period. In terms of distribution, MSF declared an interim cash dividend of Rs. 11.14 per unit, translating to a total payout of Rs. 1,907 million.

JCR-VIS Credit Rating Company has assigned a Stability Rating of AA(f) to the Meezan Sovereign Fund, reflecting its strong performance and financial stability. The fund continues to attract a diverse range of investors, with total unit holders as of June 30, 2024, reaching 23,014, distributed across various unit ranges from below ten thousand to over half a million units.