RHB Islamic Bond Fund Report - April 2019

Transcription

1. FUND FACTSHEET – APRIL 2019 All data expressed as at 31 March 2019 unless otherwise stated RHB ISLAMIC BOND FUND This Fund aims to provide regular income to investors through investments in Islamic debt securities and Islamic bonds which are acceptable investment under the principles of Shariah. INVESTOR PROFILE INVESTMENT STRATEGY This Fund is suitable for Investors who: • are risk averse; • want an investment that complies with the principles of Shariah; • want to have regular income from their investment; • want a professionally managed portfolio of sukuk and Islamic fixed income securities; and • require higher returns than Islamic fixed deposits at an acceptable level of risk. • Minimum of 60% and up to 95% of NAV will be invested in Islamic debt securities and Islamic bonds (collectively referred to as “sukuk”). • Minimum of 5% of NAV will be invested in liquid assets acceptable under Shariah principle. FUND PERFORMANCE ANALYSIS FUND DETAILS Performance Chart Since Launch* Cumulative Performance (%)* 1 Month Fund 0.86 Benchmark 0.28 Manager 3 Months 1.98 0.80 6 Months 1.84 1.66 YTD 1.98 0.80 3 Years 15.42 10.07 5 Years 33.75 17.80 Since Launch 213.35 N/A Trustee Fund Category Fund Type Launch Date Unit NAV Fund Size (million) Units In Circulation (million) Financial Year End MER (as at 30 Sep 2018) Min. Initial Investment Min. Additional Investment Benchmark Sales Charge Redemption Charge Annual Management Fee Fund Benchmark 1 Year 4.92 3.35 Annual Trustee Fee Redemption Period Calendar Year Performance (%)* 2018 Fund 4.01 Benchmark 3.35 2017 4.92 3.16 2016 6.37 3.33 2015 6.78 3.60 Source: Lipper IM 2014 5.91 3.24 Distribution Policy *All fees and charges payable to Manager and the Trustee are subject to any applicable taxes and/or duties and at such rate as may be imposed by the government from time to time. For the purpose of computing the annual management fee and annual trustee fee, the NAV of the Fund is exclusive of the management fee and trustee fee for the relevant day. FUND PORTFOLIO ANALYSIS Sector Allocation* Construction Infrastructure Government Financial Services Utilities Consumer Real Estate Property Industrial Products & Services Communication Cash 5% 10% 15% 20% 25% Top Holdings (%)* BRIGHT FOCUS BHD IMTN** 2.500% (24/01/2030) MEX II IMTN** 5.800% (28/04/2028) ISSUE NO 8 MEX II IMTN** 6.000% (29/04/2030) ISSUE NO 10 MEX II IMTN** 5.700% (29/04/2027) ISSUE NO 7 GII MURABAHAH 4.369% 2/2018 (31/10/2028) *As percentage of NAV, ** IMTN: Islamic Medium Term Note RHB Asset Management Sdn Bhd (174588-x) 12 Months 1.4245 1.3390 Since Launch 1.4245 0.9901 Source: Lipper IM 5.57% 2.26% 1.32% 1.28% 0.57% 8.00% 0% FUND STATISTICS Historical NAV (RM) 1 Month High 1.3816 Low 1.3696 19.30% 19.13% 15.91% 14.08% 12.58% RHB Asset Management Sdn. Bhd. CIMB Islamic Trustee Bhd Bond fund (Shariah-compliant) Income Fund 25 August 2000 RM1.3817 RM312.54 226.20 30 September 0.99% RM1,000.00 RM100.00 MIB12 mths Islamic FD-i None Up to 1% of NAV per unit on or before 1st year of Investment* Profit Sharing: 15:85 based on Net Investment Income* 0.10% p.a. of NAV, subject to a min. of RM35,000 p.a.* Within 10 days after receipt the request to repurchase Annually, if any 6.73 5.18 3.51 3.42 3.32 Historical Distributions (Last 5 Years) (Net) Distribution Yield (%) (sen) 26 Sep 2018 7.0000 5.06 20 Sep 2017 5.6000 4.05 27 Sep 2016 5.4000 4.00 28 Sep 2015 8.9000 6.58 25 Sep 2014 8.8000 6.51 Source: RHB Asset Management Sdn. Bhd. Head Office: Level 8, Tower 2 & 3, RHB Centre, 50400 Kuala Lumpur General Line: 603-9205 8000
2. FUND FACTSHEET – APRIL 2019 All data expressed as at 31 March 2019 unless otherwise stated RHB ISLAMIC BOND FUND This Fund aims to provide regular income to investors through investments in Islamic debt securities and Islamic bonds which are acceptable investment under the principles of Shariah. MANAGER'S COMMENTS MARKET REVIEW Malaysian Ringgit (MYR) reversed the appreciation course against the United States Dollar (USD) seen from December 2018 in March 2019. USDMYR sold off from 4.0658 at the start of the month and closed the end of the month of March 2019 at 4.0820 though still firmly below the 4.10 psychological barrier, representing a -0.40% total spot return. On the local rates, both Malaysia’s sovereign papers ie; Malaysia Government Securities (MGS) and Government Investment Issues (GII) strengthening further to close the first quarter of the year by 30 basis points (bps) to 40 bps lower respectively in term of yields. For reference, the current 10-year MGS yield ended the quarter at 3.77% from 4.07% at the beginning of the year. This recent rally in local bond/sukuk market has been infused by further dovish affirmation stance on growth and inflation outlook by Bank Negara Malaysia (BNM) at their recent Monetary Policy Committee (MPC) Meeting and BNM Annual Report released. Following the release, trading momentum saw renewed interest with market participants seen adding stocks and subsequently pressing the yields down and extending the sovereign curve lower as interest rates are expected to remain accommodative with long-end yields stay attractive. On the other note, domestic demand and supply dynamic remains supportive as shown by strong bid-to-cover (BTC) ratios for government bond/sukuk auctions in the first quarter of 2019. The BTC has averaged 2.74x compared to the usual reading of 2.0x to 2.5x. Demand for duration has also enticed bidding interest from both real-money and trading accounts as participants are getting comfortable in extending their duration in the absence of upbeat inflation data and growth number, anchored by strong domestic support. At month-end closed, MGS yields 3-, 5-, 7-, 10-, 15-, 20- and 30-year MGS were reported at 3.38% (February 2019: 3.57%), 3.53% (3.71%), 3.72% (3.87%), 3.77% (3.89%), 4.09% (4.29%), 4.29% (4.49%) and 4.58% (4.71%) respectively. The GII – Shariah compliant version of MGS mirrored the same pattern with its MGS counterpart as the whole curve ended lower in February 2019. The GII 15-year and GII 20-year were the best performers with yield closed 9 bps lower during the month. At month end close, the 3-, 5-, 7-, 10-, 15-, 20- and 30-year GII were reported at 3.48% (February 2019: 3.64%), 3.63% (3.82%), 3.79% (3.97%), 3.82% (4.03%), 4.11% (4.37%), 4.36% (4.60%) and 4.62% (4.84%) respectively. In the MYR corporate bond/sukuk space, overall monthly trading volume remain supported as investors continuously filling-up their portfolio position for absolute yield preservation amid further yield compression in the government securities space and moderate fresh supply in the corporate/sukuk space. Overall trading volume recorded MYR10.40 billion, slightly higher compared to MYR10.09 billion recorded in previous month. However, the average daily volume closed lower at about MYR495 million in March 2019, compared to MYR594 average daily volume recorded in previous month due to higher number of trading days. We noticed that most of the trading activities were highly concentrated in Government Guaranteed (GG) papers despite spread tightening in the space. The volume for GG surged 16% higher month-on-month (MoM) and recorded 51.8% of the overall trading activities in the MYR corporate/sukuk market in March 2019. Overall during the month, a combination of GG and AAA-rated space changing hands at about 69% followed by AA-rated space by 24% and single-A-rated or lower by 15%, which witnessed the highest number of trades, changing hands at about 62% followed by AA-rated space by 34% and single-A-rated or lower by 7%. Within the GG/AAA-rated space, Prasarana Malaysia Berhad was the most sought after as the transaction volume garnered MYR1.46 billion across the tenors which saw the yield closed lower by a whopping 20 bps MoM. Higher volume that surpassing a billion mark was also seen in Danainfra Nasional Berhad issuance which recorded around MYR1.21 billion in transaction volume across the. On average, the yield closed 20 bps to 24 bps lower especially on the longer tenor universe. In AAA-rated space, demand for Danga Capital were also seen in the longer-dated tenor with more than MYR300 million trade changing hands with the yield closed down to 13 bps lower compared to previous month. Telekom Malaysia on a different issuance, attracted more than MYR300 million of trading volume during the month and the yield closed 17 bps lower on the 2028 maturity. Elsewhere in AA-rated space, Edra Energy bonds, top the trading activities for the second consecutive months with MYR350 million changing hands across the tenor to possibly real money investors and closed the month at approximately 11 bps to 15 bps lower compared to last month. The bonds/sukuk continue to attract demand from investors searching for higher yield preservation. In the A-rated space, UMW Perpetual Sukuk was back in the radar and printed some MYR200 million of transaction volume during the month which saw the yield tighter by 14 bps compared to previous month’s closed. In the primary issuance space, total supply in March 2019 has been grossly higher at a total issue size of MYR8.64 billion with 60% of the total issuances being dominated by GG-rated space. The total issuance in March 2019 was slightly higher compared to MYR8.27 billion recorded in February 2019 month. In term of issuer, Perbadanan Tabung Pendidikan Tinggi Nasional (PTPTN) emerged as the largest issuer in March 2019 with its MYR3.0 billion size with tenors ranging from 10-year, 15-year and 20-year. The final yield ended at 4.27%, 4.58% and 4.80% respectively. On the other issuance, Prasarana Malaysia Berhad was also seen tapping the bond/sukuk market during the month with an issue size of MYR 1.5 billion. The issuance tenor was for 10-year, 12-year and 15-year at a final yield of at 4.20%, 4.38% and 4.53 respectively. In a single-A-rated space, the subsidiary of IJM Corporation, IJM Land Berhad issued its first Perpetual Sukuk with two maturity ; Non-Callable 7year and Non-Callable 8-year with a final yield of 5.65% and 5.73%. Both were issued at a size of MYR650 million respectively. On a financial sector, we noted Hong Leong Financial Group (HLFG) raised about MYR400 million on its Perpetual Non-Callable 5-year at a yield of 4.82%. On the local economic front, the economy remained in the deflationary mode for the two consecutive months. Malaysia’s Consumer Prices Index (CPI) for February 2018 fell by -0.4% year-on-year (YoY) from -0.7% reading in prior month, which is lower than consensus expectation of -0.3%. With that, average inflation for the first two months fell at about -0.6% this year. Meanwhile, food prices grew at the pace of 1.0% while the non-food prices reported a drop of -1.0%. The drag from the non-food prices came mainly from the transport prices that fell by -6.8% in February 2019. Going forward, we expect inflation number to improve gradually, supported by the low base effect. With RON95 prices rising averagely 5% in March 2019 to MYR2.08/litre, headline inflation this year could for the first time turn positive. Going forward, Malaysia’s total trade number is projected to grow moderately by 5% in 2019 from 5.9% in 2018 due to uncertainties in the global market outlook. On the other economic data, Malaysia Industrial Production Index (IPI) registered an increase of 3.2% in January 2019 as compared to the same month in the previous year. The growth in IPI number was supported by an increase in Electricity (+7.8%) and Manufacturing (4.2%) while Mining recorded a decline of 0.9% due to decrease in Crude Oil (-2.2%). The Jan IPI follows recent upbeat exports numbers and decent imports data for the same month, at +3.1% YoY (-0.6% consensus) and +1.0% YoY (+1.2% YoY consensus) respectively. The numbers for January 2019 were a good start for growth in 1Q19, but sentiment in the bond/sukuk market remains driven by the MPC statement while inflation remains low. DISCLAIMER: Based on the fund’s portfolio returns as at 10 March 2019, the Volatility Factor (VF) for this fund is 2.1 and is classified as “Low”. (source: Lipper) “Low” includes funds with VF that are above 1.8 but not more than 6.6 (source: Lipper). The VF means there is a possibility for the fund in generating an upside return or downside return around this VF. The Volatility Class (VC) is assigned by Lipper based on quintile ranks of VF for qualified funds. VF is subject to monthly revision and VC will be revised every six months. The fund’s portfolio may have changed since this date and there is no guarantee that the fund will continue to have the same VF or VC in the future. Presently, only funds launched in the market for at least 36 months will display the VF and its VC. The VC referred to was dated 31 December 2018 which is calculated once every six months and is valid until its next calculation date, i.e. 30 June 2019. A Product Highlights Sheet (“PHS”) highlighting the key features and risks of the Fund is available and investors have the right to request for a PHS. Investors are advised to obtain, read and understand the PHS and the contents of the Master Prospectus dated 15 July 2017 and its supplementary(ies) (if any) (“the Master Prospectus”) before investing. The Master Prospectus has been registered with the Securities Commission Malaysia who takes no responsibility for its contents. Amongst others, investors should consider the fees and charges involved. Investors should also note that the price of units and distributions payable, if any, may go down as well as up. Where a distribution is declared, investors are advised that following the issue of additional units/distribution, the NAV per unit will be reduced from cum-distribution NAV to ex-distribution NAV. Any issue of units to which the Master Prospectus relates will only be made on receipt of a form of application referred to in the Master Prospectus. For more details, please call 1-800-88-3175 for a copy of the PHS and the Master Prospectus or collect one from any of our branches or authorised distributors. The Manager wishes to highlight the specific risks of the Fund are credit / default risk, issuer risk, interest rate risk, liquidity risk and shariah specific risk. These risks and other general risks are elaborated in the Master Prospectus. This factsheet is prepared for information purposes only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive it. Past performance is not necessarily a guide to future performance. Returns may vary from year to year. RHB Asset Management Sdn Bhd (174588-x) Head Office: Level 8, Tower 2 & 3, RHB Centre, 50400 Kuala Lumpur General Line: 603-9205 8000