Ellah Lakes: Price vs Business Reality — A Balanced View

[Chinyere]

It’s important to separate market sentiment from company fundamentals. Recently, Ellah Lakes Plc has actually recorded repeated losses, so the concerns some investors have are not completely unfounded.
For example:
The company reported about ₦146 million revenue but an operating loss of about ₦1.87 billion due to high administrative and personnel costs.
Losses were also driven by foreign exchange losses and rising operating costs as the company expands into palm oil, rice, and sugar production.

Over time, retained losses have continued to grow, and profitability has not yet been achieved.

So the honest truth is this:
Fundamentally, the company is still in the investment/expansion stage, not the profit stage. That means it is a high-risk, long-term type of stock, not a short-term performance stock.
Now, we have seen similar situations before. A company like Oando Plc recorded losses in the past but later returned to profitability after restructuring and cost control.
This shows that loss-making companies can turn around — but not all of them do.

The real issue is strategy and time horizon:

If you are a short-term trader, a loss-making company is risky.
If you are a long-term investor, you are betting on future growth, not current profit.
But whether long-term or short-term, fundamentals must eventually support the price — that is the honest truth.

Do you think Ellah Lakes is a long-term growth story that needs time, or do you think the fundamentals must improve first before the price can be justified?

 

[Adewale Stock]

what does Ella Lakes do sef. what do they sell or manufacture? I am not familiar with these companies.

 

[Chinyere]

what does Ella Lakes do sef. what do they sell or manufacture? I am not familiar with these companies.

Ellah Lakes Plc is an agribusiness company, not a bank and not a typical manufacturing company. They are mainly into farming and agricultural processing.

What They Produce
Ella Lakes is involved in large-scale farming of:
Oil palm (used to produce palm oil)
Cassava (used for starch, flour, ethanol)
Maize
Soybean
Rice
Piggery (pig farming)

So what do they sell? They sell agricultural produce and processed products like:
Palm oil
Cassava flour
Starch
Ethanol (from cassava)
Grains (maize, rice, soybean)
Their goal is to become a major supplier of edible oil and starch to food companies and FMCG manufacturers.

But Here’s the Important Part (Financial Reality)
From their recent financial report:
Revenue: about ₦146 million
Operating loss: about ₦1.87 billion
The company is still making losses
Costs are rising faster than revenue
Cash is reducing because they are investing heavily in expansion

Ella Lakes is a growth/expansion company, not a profit company (for now).
They are buying land, building processing plants, expanding farms — hoping profits will come later.
So investors buying it are betting on future potential, not current profit.

Are they profitable?
No, currently making losses
Why are people buying?
Future growth potential

Do you invest in a company because of what it is earning today, or because of what it might become in the future?

 

[Adewale Stock]

Ellah Lakes Plc is an agribusiness company, not a bank and not a typical manufacturing company. They are mainly into farming and agricultural processing.

What They Produce
Ella Lakes is involved in large-scale farming of:
Oil palm (used to produce palm oil)
Cassava (used for starch, flour, ethanol)
Maize
Soybean
Rice
Piggery (pig farming)

So what do they sell? They sell agricultural produce and processed products like:
Palm oil
Cassava flour
Starch
Ethanol (from cassava)
Grains (maize, rice, soybean)
Their goal is to become a major supplier of edible oil and starch to food companies and FMCG manufacturers.

But Here’s the Important Part (Financial Reality)
From their recent financial report:
Revenue: about ₦146 million
Operating loss: about ₦1.87 billion
The company is still making losses
Costs are rising faster than revenue
Cash is reducing because they are investing heavily in expansion

Ella Lakes is a growth/expansion company, not a profit company (for now).
They are buying land, building processing plants, expanding farms — hoping profits will come later.
So investors buying it are betting on future potential, not current profit.

Are they profitable?
No, currently making losses
Why are people buying?
Future growth potential

Do you invest in a company because of what it is earning today, or because of what it might become in the future?

are people buying their products like that? I really want to see waht they really do, do they brand these agricultural products cos I dont remember seeing their brand on shelves.

 

[Chinyere]

are people buying their products like that? I really want to see waht they really do, do they brand these agricultural products cos I dont remember seeing their brand on shelves.

Not really.
Ellah Lakes is mostly a B2B company (Business-to-Business), not a popular retail brand.
They don’t mainly sell to you and me in supermarkets.
They mostly sell raw or semi-processed agricultural products to:
Food processing companies
FMCG manufacturers
Industrial companies
Export markets

What They Actually Sell
Ellah Lakes business is around:

Palm oil → sold to food companies
Cassava → used for starch, flour, ethanol
Maize & Soybean → sold to feed mills and food companies
Rice → processed and sold in bulk
Piggery → meat supply
So instead of branding like:
Dangote Rice
Mama’s Pride
Golden Penny
They are more like a supplier to companies that produce those finished goods.
Think of them like a farm + raw material supplier, not a supermarket brand.

 

[Adegoroye]

It’s important to separate market sentiment from company fundamentals. Recently, Ellah Lakes Plc has actually recorded repeated losses, so the concerns some investors have are not completely unfounded.
For example:
The company reported about ₦146 million revenue but an operating loss of about ₦1.87 billion due to high administrative and personnel costs.
Losses were also driven by foreign exchange losses and rising operating costs as the company expands into palm oil, rice, and sugar production.

Over time, retained losses have continued to grow, and profitability has not yet been achieved.

So the honest truth is this:
Fundamentally, the company is still in the investment/expansion stage, not the profit stage. That means it is a high-risk, long-term type of stock, not a short-term performance stock.
Now, we have seen similar situations before. A company like Oando Plc recorded losses in the past but later returned to profitability after restructuring and cost control.
This shows that loss-making companies can turn around — but not all of them do.

The real issue is strategy and time horizon:

If you are a short-term trader, a loss-making company is risky.
If you are a long-term investor, you are betting on future growth, not current profit.
But whether long-term or short-term, fundamentals must eventually support the price — that is the honest truth.

Do you think Ellah Lakes is a long-term growth story that needs time, or do you think the fundamentals must improve first before the price can be justified?

I believe it is the stock for the future..No matter what they are going through ,it will come to past ....Apart from oando ,okumo too has gone through this .. People are seeing losses but it is cos they are borrowing to do expansion and cos of the sector ellah lakes ,even if its invest 1 trillion into oil palm it will take up to 5 years before the palm start fruiting..Without the fruit they can not make profit but when the fruit that to come out they will start to pay their debt and they can also convert those debts to equity...What am seeing is future potential..
Two ,the price at which it is currently trading might be too high for the future gain ... However,no one can time the market ...If it comes down and one have free money one can take positions ....

 

[Adegoroye]

It’s important to separate market sentiment from company fundamentals. Recently, Ellah Lakes Plc has actually recorded repeated losses, so the concerns some investors have are not completely unfounded.
For example:
The company reported about ₦146 million revenue but an operating loss of about ₦1.87 billion due to high administrative and personnel costs.
Losses were also driven by foreign exchange losses and rising operating costs as the company expands into palm oil, rice, and sugar production.

Over time, retained losses have continued to grow, and profitability has not yet been achieved.

So the honest truth is this:
Fundamentally, the company is still in the investment/expansion stage, not the profit stage. That means it is a high-risk, long-term type of stock, not a short-term performance stock.
Now, we have seen similar situations before. A company like Oando Plc recorded losses in the past but later returned to profitability after restructuring and cost control.
This shows that loss-making companies can turn around — but not all of them do.

The real issue is strategy and time horizon:

If you are a short-term trader, a loss-making company is risky.
If you are a long-term investor, you are betting on future growth, not current profit.
But whether long-term or short-term, fundamentals must eventually support the price — that is the honest truth.

Do you think Ellah Lakes is a long-term growth story that needs time, or do you think the fundamentals must improve first before the price can be justified?

I believe it is the stock for the future..No matter what they are going through ,it will come to past ....Apart from oando ,okumo too has gone through this .. People are seeing losses but it is cos they are borrowing to do expansion and cos of the sector ellah lakes ,even if its invest 1 trillion into oil palm it will take up to 5 years before the palm start fruiting..Without the fruit they can not make profit but when the fruit that to come out they will start to pay their debt and they can also convert those debts to equity...What am seeing is future potential..
Two ,the price at which it is currently trading might be too high for the future gain ... However,no one can time the market ...If it comes down and one have free money one can take positions

Not really.
Ellah Lakes is mostly a B2B company (Business-to-Business), not a popular retail brand.
They don’t mainly sell to you and me in supermarkets.
They mostly sell raw or semi-processed agricultural products to:
Food processing companies
FMCG manufacturers
Industrial companies
Export markets

What They Actually Sell
Ellah Lakes business is around:

Palm oil → sold to food companies
Cassava → used for starch, flour, ethanol
Maize & Soybean → sold to feed mills and food companies
Rice → processed and sold in bulk
Piggery → meat supply
So instead of branding like:
Dangote Rice
Mama’s Pride
Golden Penny
They are more like a supplier to companies that produce those finished goods.
Think of them like a farm + raw material supplier, not a supermarket brand.

Sir ,later they should sell directly and do additional value to the product...This will give them leverage...In terms of land ,they are not doing badly ...The company will survive this am sure

 

[Adegoroye]

It’s important to separate market sentiment from company fundamentals. Recently, Ellah Lakes Plc has actually recorded repeated losses, so the concerns some investors have are not completely unfounded.
For example:
The company reported about ₦146 million revenue but an operating loss of about ₦1.87 billion due to high administrative and personnel costs.
Losses were also driven by foreign exchange losses and rising operating costs as the company expands into palm oil, rice, and sugar production.

Over time, retained losses have continued to grow, and profitability has not yet been achieved.

So the honest truth is this:
Fundamentally, the company is still in the investment/expansion stage, not the profit stage. That means it is a high-risk, long-term type of stock, not a short-term performance stock.
Now, we have seen similar situations before. A company like Oando Plc recorded losses in the past but later returned to profitability after restructuring and cost control.
This shows that loss-making companies can turn around — but not all of them do.

The real issue is strategy and time horizon:

If you are a short-term trader, a loss-making company is risky.
If you are a long-term investor, you are betting on future growth, not current profit.
But whether long-term or short-term, fundamentals must eventually support the price — that is the honest truth.

Do you think Ellah Lakes is a long-term growth story that needs time, or do you think the fundamentals must improve first before the price can be justified?

I believe it is the stock for the future..No matter what they are going through ,it will come to past ....Apart from oando ,okumo too has gone through this .. People are seeing losses but it is cos they are borrowing to do expansion and cos of the sector ellah lakes ,even if its invest 1 trillion into oil palm it will take up to 5 years before the palm start fruiting..Without the fruit they can not make profit but when the fruit that to come out they will start to pay their debt and they can also convert those debts to equity...What am seeing is future potential..
Two ,the price at which it is currently trading might be too high for the future gain ... However,no one can time the market ...If it comes down and one have free money one can take positions

Not really.
Ellah Lakes is mostly a B2B company (Business-to-Business), not a popular retail brand.
They don’t mainly sell to you and me in supermarkets.
They mostly sell raw or semi-processed agricultural products to:
Food processing companies
FMCG manufacturers
Industrial companies
Export markets

What They Actually Sell
Ellah Lakes business is around:

Palm oil → sold to food companies
Cassava → used for starch, flour, ethanol
Maize & Soybean → sold to feed mills and food companies
Rice → processed and sold in bulk
Piggery → meat supply
So instead of branding like:
Dangote Rice
Mama’s Pride
Golden Penny
They are more like a supplier to companies that produce those finished goods.
Think of them like a farm + raw material supplier, not a supermarket brand.

Sir ,later they should sell directly and do additional value to the product...This will give them leverage...In terms of land ,they are not doing badly ...The company will survive this am

 

[Chinyere]

I believe it is the stock for the future..No matter what they are going through ,it will come to past ....Apart from oando ,okumo too has gone through this .. People are seeing losses but it is cos they are borrowing to do expansion and cos of the sector ellah lakes ,even if its invest 1 trillion into oil palm it will take up to 5 years before the palm start fruiting..Without the fruit they can not make profit but when the fruit that to come out they will start to pay their debt and they can also convert those debts to equity...What am seeing is future potential..
Two ,the price at which it is currently trading might be too high for the future gain ... However,no one can time the market ...If it comes down and one have free money one can take positions ....

Exactly! You’ve captured it well — Ellah Lakes is very much a long-term growth story. Right now, it’s in the heavy investment phase: borrowing to expand into palm oil, rice, and sugar, which naturally suppresses short-term profits. Like you said, the payoff takes time — palm trees don’t fruit overnight, and the benefits of these investments will only show in a few years.
The key is patience and timing: the fundamentals suggest real potential, but the current share price might already reflect some of that future growth. For investors with cash ready, dips can be an opportunity to build a position for the long-term upside.

Do you focus more on the current price and short-term gains, or are you comfortable locking in for several years to ride out the growth trajectory?

 

[Adegoroye]

For me i will keep eyes on it ...I have believe in this stock...

Exactly! You’ve captured it well — Ellah Lakes is very much a long-term growth story. Right now, it’s in the heavy investment phase: borrowing to expand into palm oil, rice, and sugar, which naturally suppresses short-term profits. Like you said, the payoff takes time — palm trees don’t fruit overnight, and the benefits of these investments will only show in a few years.
The key is patience and timing: the fundamentals suggest real potential, but the current share price might already reflect some of that future growth. For investors with cash ready, dips can be an opportunity to build a position for the long-term upside.

Do you focus more on the current price and short-term gains, or are you comfortable locking in for several years to ride out the growth trajectory?

 

[Chinyere]

I believe it is the stock for the future..No matter what they are going through ,it will come to past ....Apart from oando ,okumo too has gone through this .. People are seeing losses but it is cos they are borrowing to do expansion and cos of the sector ellah lakes ,even if its invest 1 trillion into oil palm it will take up to 5 years before the palm start fruiting..Without the fruit they can not make profit but when the fruit that to come out they will start to pay their debt and they can also convert those debts to equity...What am seeing is future potential..
Two ,the price at which it is currently trading might be too high for the future gain ... However,no one can time the market ...If it comes down and one have free money one can take positions

Sir ,later they should sell directly and do additional value to the product...This will give them leverage...In terms of land ,they are not doing badly ...The company will survive this am

Exactly! That’s the point — Ellah Lakes’ current model is B2B, so they’re focused on supplying raw and semi-processed goods rather than retail branding. Expanding into direct-to-consumer or adding value to products could give them better margins and market leverage, but it’s a different business model that comes with higher costs and operational challenges.
For now, their land holdings and supply capabilities are solid, which supports long-term growth. Survival isn’t really the issue; it’s about how efficiently they convert those assets into profits over time.

Should investors bet on the current B2B model’s potential, or wait to see if they successfully move into value-added/retail markets?