Company Overview

Ellah Lakes Plc (ELLAHLAKES) was established as a private company in 1980. Its principal business activity was fish farming. It was converted into a public limited company in 1992. ELLAHLAKES abandoned fish farming in 2019 following the acquisition of Telluria Farms, an oil palm producer. The company has been transformed into a value-chain agricultural company producing and processing crops such as oil palm, cassava, maize and soybean.

ELLAHLAKES has made a few acquisitions for the purpose of expanding its capacity and positioning the company as a leading vertically integrated agribusiness, such as ELP Sunshine Limited and Adani Staple Crop Processing Zone Food Company Limited. The company has acquired a considerable amount of land that is available for its activities. It has about 11,000 hectares of land in Edo, Enugu and Ondo States in Nigeria. It also partners with different organisations to improve its crop yields and its competencies across the agricultural value chain.

The company’s 11-member board of directors is chaired by Mr. Joe Attueyi. Mr. Chukwuka Mordi is the managing director of ELLAHLAKES.

Investment Thesis

ELLAHLAKES is diversifying its operations to cushion the effects of relying on a single product. Apart from the 2,400 hectares cultivated for oil palm production in Edo State, the company engages in livestock farming. The piggery business, which was introduced in 2024, has started contributing to the company’s revenue. Livestock sales produced NGN10.3 million or 7% of total sales revenue in the 17 months to December 31, 2025.

ELLAHLAKES‘ financial performance has not been encouraging. Recurring losses incurred over the past years have led to an accumulated loss of NGN10.6 billion as at 30 June 2026. However, the company’s restructuring efforts have started to pay off, with noticeable improvements in performance since 2025. The company made revenue of NGN146.7 million in the 17 months to 31 December, 2025. Revenue for the first half-year of 2026 was NGN533.9 million, while loss before tax was NGN782.6 million. The loss before tax in the 17 months to December 2025 was NGN3.8 billion.

ELLAHLAKES‘ oil palm plantation has started bearing fruits, and it is expected to contribute to revenue going forward. The oil palm trees are expected to continue to bear fruits for over two decades. The company’s Crude Palm Oil (CPO) Mill started operations in July 2025 and a Palm Kernel Oil processing mill is in the pipeline. The company boasts of a considerable land bank that can aid its expansion drive. ELLAHLAKES should start making a profit in the medium term.

Debt and working capital management have been highly commendable. In spite of the inconsistency in revenue generation and regular spending on capital, the company has been able to keep debt at a manageable level.

Presently, the company is not generating positive operating profit and operating cash flow. In addition, shareholders have not been receiving dividends. However, we believe ELLAHLAKES is on the right path. The management is committed to ensuring the company becomes profitable and sustainable. The shares of ELLAHLAKES should produce a reasonable return in the long haul.

Valuation

The fair value of a share of ELLAHLAKES is between NGN4.10 and NGN5.90. The current market price of NGN7.90 is above our fair value estimate.

Financial Overview

ELLAHLAKES did not make adequate revenue from its fish farming business owing to competitive pressure and frequent disruption of operations. Between 2012 and 2017, it realised a total revenue of NGN277.7 million vis-à-vis a total cost of NGN416.2 million, producing an operating loss of NGN138.5 million during that period. The company eventually suspended its operations due to militancy in Rivers State Nigeria, where its fish farm was located. It sold off its farm in Rivers State and purchased a 100% holding in Telluria Farms, a company that is engaged in oil palm production at its 2,400 hectares of land in Edo State, Nigeria. ELLAHLAKES did not make any revenue for four fiscal years (2020,2021, 2022 and 2023). In the fiscal year to 31st July 2025, total revenue was NGN67.1 million compared to NGN0.8 million revenue made in the preceding year. Oil palm sales were NGN57.2 million while livestock sales amounted to NGN9.9 million in 2025. The company only made revenue from oil palm in 2024. The loss after tax was NGN1.6 billion, up by 78.6% from the previous year. The total assets have been growing largely due to the acquisition of more land. Total assets rose by 26.5% year-on-year to NGN31.1 billion at the end of July 2025. The value of land was  NGN22.6 billion, representing 72.9% of total assets. Shareholders’ fund has also been on the rise, standing at NGN22.7 billion.

ELLAHLAKES has been paying down its debt, in spite of not making any operating profit. The director’s loan, which stood at NGN7.1 billion at 31st December 2025, was converted to equity. The total outstanding loan as at 30 June 2026 was NGN297.7 million. It was a non-current loan which was not expected to be settled in the current fiscal year. The total debt was 1.2% of both total assets and total equity.

Business Risk

ELLAHLAKES is exposed to exchange risk because it imports some inputs. Exchange rate fluctuations hurt the company’s profitability. In addition, high input costs can adversely affect the profit margins. Furthermore, ELLAHLAKES’ continuous operation can be hampered by insecurity in its operating environment. The subpar performance of the company may hinder its ability to raise finance to expand its scale and enjoy cost savings.

Recommendation: Overpriced