Lucky Investments has carried out its first series of fundraising and based on the results, it is clear to see that investors expect lightning to strike twice. In a single day, the Asset Management Company (AMC) was able to see an incredible response so much that investors were willing to invest Rs 50 billion in the first fund launched by the AMC. This was one for the record books as it is the largest-ever mutual fund launch that has been seen in Pakistan.
In terms of subscription records, the AMC was able to shatter all previous records as its Lucky Islamic Money Market Fund saw such an overwhelming response.
“Alhamdulillah, we are profoundly grateful for the extraordinary trust placed in us by investors across Pakistan,” stated Mohammad Shoaib, Chief Executive Officer at Lucky Investments speaking at the launch event.
“Breaking the national record with a PKR 50 Billion subscription in a single day is not just a milestone for Lucky Investments, but a testament to the growing strength of Islamic finance in our market. As we prepare to launch additional funds in the coming months, we remain steadfastly committed to maintaining this momentum while delivering unparalleled customer experience and strict Shariah compliance.”
The success of the IPO can be attributed to three key factors. First of all, the latest fund provides an opportunity for investors to invest in Shariah-compliant funds which are scarcely available as it is.
With Islamic Finance gaining traction and demand, investors are willing to invest in these funds as they are being made available. These funds also allow Shariah-compliant companies to stay compliant with their mandate and invest in these instruments which were not available previously.
The recent introduction of Sukuk, Islamic financing, and Shariah-compliant mutual funds provide a better alternative to these investors who had no such option available to them in the past.
The second reason for the response is based on the fact that YB Group is considered to be a well-established and stable conglomerate that has grown and developed locally on the back of entrepreneurial risk-taking and business development.
YB Group has an array of investments in different sectors ranging from construction to power generation to textiles. This new challenge being taken on by the group shows that they look to not only enter this new market but become market leaders like they have done in the past in other sectors.
Lucky Investments announced in December of 2024 that they were looking to expand into the asset management business by acquiring the asset management certificate which had been acquired by Interloop. The license granted to Interloop saw little to no use as the company only listed one equity fund before it was closed. Rather than applying for a new license, YB Group, the group behind Lucky decided to buy it instead.
Last but certainly not least is the person who has been chosen to lead this project which shows the commitment and the seriousness with which this project is being carried out. Mohammad Shoaib has been chosen as the captain of the ship which will help them chart the new course. Shoaib is no stranger to the Islamic Asset Management Company. He was the guy who developed this field in Pakistan and then established the biggest Shariah Compliant Fund in the country under the name of Al Meezan Investments.
At the time he started, there was little to no concept of Asset Management being carried out. With asset management itself being in its infancy, Shoaib set about developing a Shariah-compliant investment fund that allowed investors to invest their savings in line with their religious beliefs. Within 3 decades, the investment company ended up managing assets worth $1.6 billion. The trust that Shoaib was able to build can be seen in the fact that Al Meezan started out as a small fund before it expanded to its current size. In addition to that, the investor base of Al Meezan had more than 300,000 investors which ranged from individuals to institutions local and international.
Shoaib resigned from his position in Al Meezan under a shroud of uncertainty as there were reports that the Securities and Exchange Commission of Pakistan had sent a letter alleging insider trading being carried out. With no punishment being handed down by the regulator, it seems that a clean bill of health was given when he was approved as the new CEO of Lucky Investments. In order to take charge of a company that handles public money, the SECP carries out its own due diligence and criteria check before approving such an appointment. When Shoaib was given the approval, the fit and proper criteria was met.
The market has its own way of giving their approval and it seems it is a resounding yes as they have given their money and their trust to the new fund being launched. It seems that they are giving a huge thumbs up to both the YB Group and their new CEO. The CEO still has to pay back much of this trust and credibility by now taking over the reins and managing the funds that have been entrusted with him. He has to appoint a capable and qualified investment committee that will make the investment decisions and look to maximise the returns. He has to do this while competing with Al Meezan funds which he helped create and grow. The crown for the best Shariah Complaint fund still rests with Al Meezan and Shoaib will prove his worth once again when he looks to surpass the market leader in due time.
On the economic front, Shoaib will also have to contend with falling interest rates, the impact of Trump’s tariff war and the government’s diminishing appetite to take on debt from the private sector. Shoaib has to make sure that he is able to minimize risk and maximise return for his investors. The record breaking performance of its first fund seems to be the first step in the right direction on this marathon he has ahead of himself.
