Update on Ellah Lakes 25th August, 2025
1) Market Data
Latest price: ₦15.45 – ₦15.50
52-week range: ₦2.85 – ₦19.42 (recent high on Aug 14, 2025)
Market cap: ₦42–43bn
Shares outstanding: 2.75bn
Free float: 1.19bn
Liquidity: Daily volumes have spiked during this year’s rally, reflecting growing retail and institutional participation.
2) Technical View
After a parabolic run to the ₦19 zone, Ellah Lakes is consolidating in a ₦13–₦17 range.
Bullish trigger: Daily close above ₦18–₦19 on strong volume → opens the way higher.
Bearish trigger: Breakdown below ₦11–₦12 support → signals deeper correction.
Momentum on higher timeframes is still constructive, but short-term oscillators show neutral signals.
3) Smart Money Concepts (SMC)
Upside liquidity: ₦17.5 – ₦19.5 (cluster of recent highs, buy-stops above).
Downside liquidity: ₦11.0 – ₦13.0 (prior accumulation zone).
Tape behavior: Episodic bursts of volume suggest thin float dynamics — fast runs are possible, often tied to corporate news.
4) Chart Geometry
Price action currently resembles a flag/rectangle consolidation after a steep uptrend.
A breakout confirms continuation → potential target mid-₦20s.
A breakdown risks retrace into low-teens demand.
5) Elliott Wave Count
2025’s big surge = Wave 3 (impulsive leg).
Current sideways action = Wave 4 consolidation.
Wave 5 confirmation = daily close above ₦18–₦19.
Invalidation = sustained close below ₦11.
6) Fundamentals — What’s Changed?
Assets & cash: Q3 2025 unaudited — total assets ₦24.9bn, cash only ₦15.9m. Inventories mainly seedlings; receivables rising.
Revenue history: Previously negligible, company in build-out mode.
Growth plans: 1,500 hectares of oil palm (2026 target), PKO mill installation, more land development.
Capital raise: Shareholders approved ₦250bn authorised capital raise (July 2025 EGM), alongside debt-to-equity conversions. This is the key fundamental risk: heavy dilution vs necessary growth financing.
Synthesis: Ellah Lakes is still early-stage — price momentum reflects anticipation of execution and new capital, not yet proven cash flows.
7) Integrated Trade Strategy (NGX, Long-Only)
Since shorting is not practical on NGX, strategies focus on long setups with defined risk.
A) Core Swing (event/execution play)
Buy zone: ₦13.00 – ₦14.20 (support)
Add: Daily close above ₦18.00 with volume
Stop: ₦10.90 (invalidates base)
Targets:
TP1: ₦17.50–₦18.80
TP2: ₦20.50–₦23.00
TP3: ₦26–₦30 (stretch, if fundamentals line up)
B) Speculative Pre-News Tranche
Entry: ₦15.00–₦16.00 small starter, high risk
Stop: ₦13.00
Quick target: ₦18–₦20 if sentiment/news pops
C) Investor Stance
If dilution risk is a concern, wait for capital raise details and tangible progress on planting/mill commissioning before adding meaningful exposure.
8) Risks, Catalysts & Conclusion
Catalysts to watch:
Final terms & timetable of the ₦250bn capital raise
Operational progress: hectares planted, mill installation, CPO/PKO throughput
Quarterly results (cash, receivables, working capital trends)
Risks:
Dilution from capital raise (scale and pricing unknown)
Execution delays in planting/mill rollout
Overvaluation if optimism fades before delivery
Conclusion:
Ellah Lakes is a high-beta agribusiness with exciting upside potential — but one that comes with heavy execution and dilution risk.
For traders: Play the range and breakout setups (₦13–₦14 support buys; >₦18 breakout adds) with tight stops.
For investors: Patience is key. Wait for clarity on capital raise terms and tangible operational progress before committing big.
The stock is best seen as a story-in-progress — capable of sharp rallies, but also vulnerable if growth financing doesn’t align with shareholder value.
