PRESCO Plc and Okomu have shown that palm oil is no longer the nano business done at the backyard by Iya Bisi or Mama Ebuka. It is now a multi-billion naira business and an investment opportunity for direct investors who wish to tap long-term profits.

Presco’s revenue stood at N207.5 billion in the 2024 financial year, which was more than double what it earned in 2023 (N102.4 billion). Its profit for the year stood at N77.8 billion as against N32.4 billion in the corresponding period of 2023, representing 140 percent increase in profit over the one-year period.

In the first quarter (Q1) of 2025, Presco’s revenue grew by 120.4 percent to N93.8 billion, from N42.5 billion reported in the corresponding period of 2023. Its operating profit stood at N69.1 billion, representing a 117.6 percent jump from the previous quarter in 2023.

Similarly, in the first half (H1) of 2025, the palm oil maker’s revenue jumped by 125.8 percent year-on-year to N198.7 billion from N88 billion recorded in H1 of 2024. Its profit after tax rose by 128.2 percent to N88.7 billion, with the palm oil maker declaring N20 per share declared as interim dividend for the period under review.

Presco is not the only player in the industry. Okomu Plc, another big player, reported N130.2 billion revenue in 2024, represening 73 percent increase from N75.1 billion in the same period of the previous year. Its profit jumped 94 percent to N39.9 billion from N20.6 billion reported in the same period of 2024.

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Similarly, the giant palm oil maker reported N129.8 billion in the first six months (H1) of 2025, representing a 73 percent increase from N75 billion in the same period of 2024. Profit after tax stood at N25.8 billion, indicating a 28 percent rise from N20.2 billion in the prior year period.

Presco and Okomu are the only two palm oil makers in Nigeria listed in the Nigerian Exchange Group. Okomu’s share price stood at N1,020 as of 12pm on Wednesday, August 27, while Presco’s was N1,480 at the same time.

Investments are rising

With the growth of the palm oil industry, investors have pumped over N2 trillion in the last seven years, BusinessDay reported. Presco Plc recently invested $172 million in the acquisition of Ghana Oil Development Company (GOPDC) and Saro Oil Palm in Ghana. Both Presco and Okomu are also expanding investments in Edo State, where both are currently based.

Another major player is PZ Wilmar, which has 26,500 hectares of land oil palm plantations in various estates in Cross River State. It has invested over $200 million in Cross River State. Also, BUA Group is moving into the space, signing a deal earlier in the year with Alfa Laval PVT Limited for the construction of a 1000 metric-ton-per-day (TPD) palm oil refinery and fractionation plant.

Sunora Foods is also in the mix. It pumped $100 million in an oil palm plantation in Edo State last year in plantations and capacity.

An opportunity for you

With profits rising, a number of individuals and firms are leveraging opportunities in the sector. Palm oil makers are planning to replant 1.5 million hectares of land over the next five years across the 27 oil palm producing states in Nigeria.

This is not surprising as the demand is high and rising. Nigeria produces only 1.4 million metric tons (MT) per annum, but local demand is 2.7 million MT, said the Food and Agriculture Organization (FOA). This implies that there is 1.3 million MT supply gap, which is yearning for investors.

Palm oil is in high demand because it has mulptiple uses. It can be used as cooking oil and for the production of margarine, spreads, dairy products, soaps, candles, drugs, cosmetics, biodiesel, skin care products, confectionery, among others.

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A report from PwC Nigeria in 2020 said it has a return on investment (ROI) of up to 15 percent –25 percent annually, depending on the scale and management of the plantation. But it is now much higher, with several companies moving into villages in search of palm oil.

Palm oil ROI is up to 50 percent to 100 percent, depending on the quality of oil, location and processing equipment. However, like most businesses, patience is required.

“The high demand for palm oil in various industries, both locally and internationally, guarantees stable cash flow for investors. In fact, the profitability of palm oil cultivation is comparable to other agricultural sectors in Nigeria, with many successful palm oil companies already reaping significant returns,” said Silvawell Harvesting, which deals in agricultural products.