Karachi: The ABL Government Securities Fund (ABL-GSF) has reported a robust annualized return of 17.14% for the fiscal year ending June 30, 2025, significantly outperforming its benchmark return of 13.57%. The fund's net assets increased to PKR 5.08 billion, up from PKR 2.70 billion at the end of the previous fiscal year, reflecting strong performance in a stable macroeconomic environment.
The Board of Directors of ABL Asset Management Company Limited expressed satisfaction with the fund's financial statements for the year, highlighting the broader economic recovery in Pakistan. The fiscal year 2025 marked a pivotal moment for the country's macroeconomic landscape, characterized by policy stability, successful completion of an IMF Standby Arrangement, and a focus on structural reforms. The real GDP grew by 2.68%, a modest increase from the previous year's 2.51%, with notable improvements in the industrial and services sectors.
Inflationary pressures eased significantly, with the Consumer Price Index (CPI) averaging 4.61% for the fiscal year, a sharp decline from 23.9% in the prior year. The State Bank of Pakistan (SBP) progressively reduced the policy rate from 20.5% to 11.0% by the end of the fiscal year, marking a cumulative easing of 950 basis points. This monetary policy shift reflected increasing confidence in macroeconomic stabilization.
According to information available from the Pakistan Stock Exchange (PSX), the fund's exposure included 17.71% in Pakistan Investment Bonds (PIBs), 65.70% in T-bills, and a 5.04% cash position at the end of the fiscal year. The government's securities market saw a decline in T-Bill yields across all tenors, while the fixed-rate PIB segment experienced significant yield compression, contributing to the fund's performance.
The fiscal year was also notable for its external account improvements, with the current account posting a cumulative surplus of USD 2.1 billion, supported by robust remittance inflows of USD 38.3 billion. Foreign exchange reserves increased to USD 19.27 billion by June 2025, bolstered by multilateral and bilateral inflows.
The mutual fund industry saw substantial growth, with assets under management rising by 44.02% year-on-year to PKR 3.86 billion. Money market and equity market funds experienced significant inflows, driven by favorable macroeconomic conditions and positive investor sentiment.
Despite the positive outlook, the directors acknowledged ongoing challenges such as revenue mobilization and external debt servicing, compounded by global geopolitical tensions. However, the foundation laid in fiscal year 2025 is expected to support continued economic stabilization and growth, contingent on sustained reform efforts and global financial support.