Quarter Under Preview: 9-Months
Current Share Price: N1,020
Price At Released: N1,020
Latest Final Dividend: N26.00
Latest Interim Dividend: N10.00
Estimated Beta Value: 0.59x
Estimated Intrinsic Value: N950.34
Analyst: Jeariogbe Tunde Segun
The Company
The principal activities of Okomu Oil Palm Company Plc, based in Nigeria, include the development of oil palm plantation, palm oil milling, palm kernel processing, and the development of rubber plantations. Its products are palm oil, palm kernel oil, palm kernel cake, banga packaging, and rubber cup lumps. The company operates through two segments: Palm plantation, and the rubber plantation. The palm plantation segment, produces fresh fruit bunches, crude palm oil, and crude palm kernel, while the rubber plantation segment, produces cup lumps. The palm plantation spans a total area of over 19,044 hectares, while the rubber plantation covers 7,335 hectares.
The Financials
At the end of the first nine months of 2025, the company reported a turnover of N170.951 billion, representing a 67.34% growth over the N103.948 billion reported in the corresponding period of 2024. Similarly, Cost of Sales grew by 38.62% to N61.874 billion, against the previous N44.635 billion. Operating Profit doubled at N86.101 billion compare to N41.191 billion in 2024. Operating Expenses through the period under review is estimated at N25.974 billion against N18.122 billion. Finance Cost dropped substantially by 73.48% to N2.319 billion from N8.747 billion. Thus, Profit Before Tax is estimated at N84.099 billion same as 106.73% above the estimate in 2024. Having considered the amount paid as Tax, the Total Profit for the year is valued at N60.332 billion against N28.338 billion in the corresponding period.
Current Assets of Okomu Oil is currently valued at N48.929 billion. This is 38.65% above the estimate reported at the end of the 2024 third quarter. Non-Current Assets stood at N135.403 billion versus N112.292 billion. Thus, Total Assets at the end of the nine months period is now N135.403 billion, while Total Liabilities is estimated at N59.987 billion, against the prior N52.974 billion. On the strength of this, Net Assets is estimated at N62.392 billion, an improvement on the N46.227 billion achieved in the comparable year of 2024. See the above table for details:
Financial Strength
The company’s financial position is now stronger year-on-year, with debt declining and equity increasing, indicating a solid long-term solvency. For example, it shows;
Improved Solvency: The company’s balance between debt and equity is healthier, meaning it can better withstand financial pressure or market downturns.
Lower Financial Risk: Reduced debt dependence means lower interest obligations and higher earnings stability.
Positive Signal for Investors: Rising equity ratio is a pointer that management is strengthening the capital base, which supports sustainable growth and dividends.
Moderate Leverage Advantage: Debt Ratio below 50% still allows for efficient use of borrowed funds without excessive risk.
Profitability Ratios
Okomu Oil Plc has demonstrated exceptional profitability, characterized by improved margins, reduced costs, and stellar returns on both equity and assets.
Operational Efficiency: The jump in EBITDA and Pre-Tax Margins shows that Okomu Oil is managing costs effectively and achieving higher profitability on each naira of revenue.
Cost Management Excellence: Lower Cost of Sales ratio suggests better control of raw materials, labor, and logistics. Possibly due to improved internal process or economies of scale.
Superior Capital Returns: The ROE of 96.7% is exceptionally high, indicating that shareholders funds are being used efficiently to generate strong returns. This enhances investor confidence and dividend potential.
Asset Productivity Strength: The ROA growth to 44.56% means the company is generating much more income per unit of assets, this is a clear sign of effective asset deployment.
Efficiency Ratios
Okomu Oil Palm Plc demonstrates excellent operational and assets efficiency, reducing costs while boosting revenue generation capacity. This dual improvement indicates a well-managed, growth-oriented, and financially disciplined company.
Operational Cost Control: The drop in OPEX to Turnover shows leaner operations, management is effectively cutting or optimizing costs without sacrificing growth or production quality.
Improved Asset Efficiency: A Turnover-to-Total Assets ratio above 100% indicates that the company’s assets are very productive. This efficiency supports profitability, cash flow, and scalability.
Enhanced Competitive Position: When both Opex and Asset Efficiency improve simultaneously, it suggests the company is strengthening its internal systems, supply chain, and possibly benefiting from economies of scale.
Management Excellence: These improvements reflects disciplined cost management and operational agility; key indicators of strong management performance.
Investment Ratios
Okomu Oil Palm Plc has delivered outstanding investment performance, characterized by strong earnings growth, increased market valuation, and enhanced shareholders’ equity. The rise in PE-Ratio and price levels reflects confidence in sustained profitability and expansions.
Strong Investor Confidence: The massive jump in share price reflects the market’s recognises the improved profitability and financial strength of Okomu Oil Palm. Investors expect future growth and steady returns.
Earnings Power Expansion: The impressive rise in EPS demonstrates that the company is delivering strong profit growth, likely driven by higher sales, better margins, and cost efficiency
Valuation Outlook: A P/E of 16.13x indicates the market values the stock as a premium agricultural company, recognizing consistent earnings and stable dividends. It is moderately high but justified by earnings momentum.
Sustainable Equity Growth: The steady rise in book value per share signals that retained profits are effectively strengthening the company’s capital base, this a strong sign for long term investors.
Earnings Yield Perspective: The decline outcome from 8.58% to 6.20% is a natural outcome of a price rally suggesting that while the stock has become pricier, it remains attractive for those seeking both stability and growth.
Dividend Information
Okomu Oil Palm Plc has demonstrated a robust dividend growth, reflecting solid profitability, disciplined cash management, and strong shareholder commitment. The surge in interim dividend highlights a profitable and confident business outlook.
Investment View/Recommendation
Buy/Accumulate: Long-Term capital growth and consistent dividend income. Best for Investors seeking steady profitability, financial strength, and sustainable returns.
