tiprankstipranks
Trending News
More News >
Olam Group (SG:VC2)
SGX:VC2

Olam Group (VC2) AI Stock Analysis

Compare
45 Followers

Top Page

SG:VC2

Olam Group

(SGX:VC2)

Select Model
Select Model
Select Model
Neutral 52 (OpenAI - 4o)
Rating:52Neutral
Price Target:
S$1.00
â–˛(6.38% Upside)
Action:ReiteratedDate:10/31/25
The overall stock score is primarily influenced by financial performance challenges, including declining revenues and cash flow issues. Technical analysis provides a neutral to slightly positive outlook, while the valuation suggests potential undervaluation. The absence of earnings call and corporate events data limits additional insights.
Positive Factors
Strategic Reorganization
The closure of Jiva Ag is part of a strategic reorganization to conserve cash and reduce debt, aligning with the goal to become debt-free and self-sustaining, which could enhance long-term financial stability.
Governance Enhancement
The appointment of a new Assistant Company Secretary is expected to enhance governance and operational efficiency, reinforcing Olam's commitment to strong corporate governance practices, which is crucial for long-term sustainability.
Debt Refinancing
ofi's $2.1 billion loan facility to refinance existing loans supports financial stability and aligns with strategic plans for an IPO and demerger, potentially strengthening market positioning.
Negative Factors
Revenue Decline
A declining revenue trend with a negative growth rate of -11.57% indicates challenges in maintaining market share and competitiveness, impacting long-term growth potential.
High Leverage
High leverage with a debt-to-equity ratio of 2.34 poses risks to financial stability, potentially limiting flexibility in capital investments and strategic initiatives.
Cash Flow Issues
Negative cash flows indicate inefficiencies in cash generation, which can strain operations and limit the ability to invest in growth opportunities, affecting long-term viability.

Olam Group (VC2) vs. iShares MSCI Singapore ETF (EWS)

Olam Group Business Overview & Revenue Model

Company DescriptionOlam Group Limited engages in the sourcing, processing, packaging, and merchandising of agricultural products worldwide. It operates through Olam Food Ingredients, Olam Global Agri, and Olam International Limited segments. The company offers cocoa powder, liquor, and butter, as well as specialty fats, such as vegetable fats, cocoa butter equivalent fats, cocoa butter improver fats, cocoa butter substitutes, and confectionery and custom fats under the under the deZaan, Unicao, Joanes, Macao, Huysman, Britannia, and BT Cocoa brands; coffee; whole, skimmed, and butter milk powders; butter, anhydrous milk fat, and butter blends; cheese; milk and whey protein concentrates, permeates, and lactose; nuts, including almonds, cashews, hazelnuts, peanuts, sesame, and quinoa and chia seeds; and spices, comprising of chillies, onion and garlic, and pepper. It also provides cotton; palm, soybean, and sunflower oils; animal feeds and proteins; flours for breads, baguettes, pasta noodles, biscuits, semolina, and confectionery; fish feeds; rubber; rice; and timber products. In addition, the company offers biscuits under the Perk, King Cracker, Pure Bliss, and Chic Choc brands; tomato mix under the Tasty Tom, De Rica, and Festin brand names; Tasty Tom Jollof Mix; drinking yoghurt under the FreshYo brand; lollipops under the OK Pop brand name; and noodles under the Cherie Noodles, Cherie Supa Chicken, and Tasty Tom brands. Further, the company engages in the poultry breeding farm and day-old-chick hatchery business; and provision of commodity financial, risk management, and infrastructure and logistics services, as well as sourcing solutions for agricultural raw materials and food ingredients. Olam Group Limited was founded in 1989 and is headquartered in Singapore.
How the Company Makes MoneyOlam Group generates revenue primarily through the sale of agricultural commodities and value-added products. The company's revenue model is diversified, encompassing several key streams: trading and processing of raw agricultural products, provision of supply chain management services, and sales of branded consumer products. Additionally, Olam earns income from financial services offered to farmers and agribusinesses, including credit and risk management solutions. Strategic partnerships with local producers, retailers, and governments further enhance its market reach and profitability, while its commitment to sustainability helps attract investment and consumer loyalty.

Olam Group Earnings Call Summary

Earnings Call Date:Feb 26, 2026
(Q4-2025)
|
% Change Since: |
Next Earnings Date:Aug 07, 2026
Earnings Call Sentiment Positive
The call communicated a materially improved financial and liquidity position: operational PATMI and free cash flow swung strongly positive, leverage and invested capital trends improved, the Olam Agri sale advanced with near‑completion of approvals, and the Remaining Group delivered a notable operational turnaround. These positive developments were balanced against continuing commodity price volatility, trade/tariff uncertainty, and weaker pockets of the portfolio (Origination & Merchandising, rice and freight), plus a deliberate decision to conserve cash (no final dividend). Overall the positive operational and balance sheet improvements and progress on strategic demerger/divestment milestones outweigh the challenges.
Q4-2025 Updates
Positive Updates
Operational PATMI Surge
Operational PATMI rose to $511 million, up 136% year-on-year (Muthu); reported PATMI was $444 million for FY2025, reflecting a strong recovery in profitability.
Combined Revenue and Volume Growth
Combined Olam Group revenue including Olam Agri reached $67 billion, up 19% year-on-year, with volumes of ~58 million tonnes (up 17%). Excluding Olam Agri (ofi + Remaining Group) revenue was ~$30 billion, up 29%.
EBIT and Business Mix Improvement
Combined EBIT was $2.2 billion, up 13% year-on-year. Of the $2.2 billion, ~49% of EBIT came from ofi, ~42% from Olam Agri and ~9% from the Remaining Olam Group, showing improved earnings contribution from the core operating groups.
Free Cash Flow and Leverage Reduction
Free cash flow to equity turned positive at roughly $360 million (a swing of ~$6.3 billion year-on-year). Nominal gearing (excluding Olam Agri) improved from 2.79x to 1.87x; adjusted net debt/equity fell from 0.68x to 0.55x (excluding Olam Agri), indicating materially improved balance sheet metrics.
Strong Liquidity Position
Total available liquidity stood at $15.5 billion with headroom of $7.6 billion, comprising ~$2.2 billion cash, ~$8.8 billion readily marketable inventories, ~$0.5 billion secured receivables and ~$4.0 billion unutilized bank lines.
Olam Agri Sale Progress and Valuation
Sale to SALIC (PIF subsidiary) values Olam Agri at around $4.0–$4.2 billion (~3.5x book). Regulatory progress strong with 20 of 21 approvals obtained and final approval expected soon, advancing the reorganization milestones.
Remaining Group Operational Turnaround
Remaining Olam Group swung from an operating loss of ~$152 million in 2024 to an operating profit of ~$198 million in 2025 (a positive swing of roughly $342–$349 million), while invested capital in the segment fell ~4% as restructuring actions progressed.
ofi Strategic and Operational Resilience
ofi maintained EBIT broadly flat despite lower volumes, with Global Sourcing EBIT up ~6.5% (on lower volumes) and Ingredients & Solutions showing maturation (private label growth across nuts, spices and coffee). Invested capital trends are moving down as higher-priced inventories normalize.
Targeted Capital Allocation Completed
Completed a $500 million equity injection into ofi to support growth initiatives; sold a 32.4% stake in ARISE Ports & Logistics for $175 million at a small premium to book, demonstrating active portfolio management.
Negative Updates
Olam Agri EBIT Decline
Olam Agri operating profit declined by 9.2% year-on-year (driven by historically low commodity prices and low volatility), creating headwinds for that operating group despite industry-wide declines of 16–44% among peers.
Origination & Merchandising Weakness
Origination & Merchandising segment fell ~35% year-on-year; cash trading's share of operating earnings dropped from ~21% to ~15%, reflecting margin compression in commodity trading activities.
Fibre, Agri‑industrials & Ag Services Softness
This segment saw operating profit decline ~13.6%, with EBIT per tonne down from ~$81 to ~$65, weighing on consolidated results in that portfolio area.
Commodities Volatility and Lead‑Lag Pressure
Extreme price swings in cocoa and coffee (e.g., cocoa moved from ~$12,000 to ~$4,000 within the year) and lead/lag in passing through prices hurt margins in parts of ofi (notably soluble coffee) and required careful working capital management.
Trade Policy and Macro Uncertainty
Escalating trade policy actions (US tariffs, potential new tariff measures and subsidy responses) create significant trade-flow risk and market distortion that could materially affect volumes, pricing and margins across the group.
Underperforming Sub-businesses
Specific businesses faced material challenges: rice business performed poorly and freight/logistics were weak, offsetting gains elsewhere and requiring further remediation or divestment.
No Final Dividend / Limited Buybacks
Board did not recommend a final dividend for FY2025 (only a first-half $0.02 payment); share buybacks were constrained due to possession of material non-public information, disappointing some shareholders in the near term.
Small Remaining Regulatory Execution Risk
One final regulatory approval is still pending for the Olam Agri transaction; although management expects completion soon, this represents a timing risk for full deal closure and related proceeds.
Company Guidance
Management guided that normalization of cocoa/coffee prices should materially reduce working capital and invested capital (total invested capital ~$25.5bn, ~61% in ofi, ~30% Olam Agri, ~9% Remaining), improving returns and cash: they reported operational PATMI of $511m (+136% y/y) and positive free cash flow to equity of ~$360m (a ~$6.3bn year‑on‑year swing). Key FY25 baselines are 58m tonnes combined volume (+17%), ~$67bn revenue (+19%), $2.2bn EBIT (+13%) and reported PATMI $444m; excluding Olam Agri volumes/revenue were 4.4m t and ~$30bn revenue with $1.26bn EBIT. Guidance highlights: ofi/Remaining to see further working‑capital and invested‑capital declines in H1 as higher‑priced inventory is released, supporting ofi’s target of low‑to‑mid single‑digit volume growth and high‑single‑digit EBIT growth (EBIT‑per‑tonne improvement driven by Ingredients & Solutions and private‑label), continued deleveraging (nominal gearing down to 1.87x excl. Agri; adjusted net‑debt/equity 0.55x excl. Agri, 0.58x incl. Agri), and use of proceeds (minimum ~$2.58bn expected from the Olam Agri sale) plus allocated capital ($2bn to degear RemainCo, $500m equity already injected into ofi) to make RemainCo debt‑free and distribute special dividends; liquidity headroom stands at ~$7.6bn of $15.5bn available (cash $2.2bn; marketable inventories $8.8bn; secured receivables $0.5bn; unutilized bank lines $4.0bn), and near‑term corporate milestones include closing remaining regulatory approvals for the Agri sale (20/21 approvals obtained) and completion of the ARISE ports stake disposal (~32.4% for $175m) by end‑April.

Olam Group Financial Statement Overview

Summary
Olam Group faces challenges across its financial statements. The income statement shows declining revenues and modest profitability. The balance sheet is stable but highly leveraged, which could pose risks. Cash flow issues are evident, with negative operating and free cash flows. The company needs to address revenue growth and manage leverage to improve its financial health.
Income Statement
45
Neutral
The income statement shows a mixed performance. The company has a declining revenue trend with a negative growth rate of -11.57% in the TTM period. Gross profit margin is relatively low at 9.14%, and net profit margin is also modest at 0.81%. However, the EBIT and EBITDA margins are slightly better, indicating some operational efficiency. Overall, the profitability is under pressure due to declining revenues.
Balance Sheet
50
Neutral
The balance sheet reflects a high debt-to-equity ratio of 2.34, indicating significant leverage, which could pose a risk if not managed properly. Return on equity is moderate at 5.20%, suggesting average returns for shareholders. The equity ratio is not explicitly calculated, but the high leverage suggests a lower proportion of equity in the capital structure. Overall, the balance sheet shows stability but with potential risks due to high leverage.
Cash Flow
40
Negative
The cash flow statement reveals challenges, with negative operating cash flow and free cash flow in the TTM period. The free cash flow growth rate is significantly negative at -58.74%, indicating cash flow issues. The operating cash flow to net income ratio is negative, reflecting cash flow inefficiencies. Free cash flow to net income ratio is positive, suggesting some ability to cover net income, but overall cash flow health is weak.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue44.61B56.28B48.27B54.90B47.00B35.82B
Gross Profit4.08B4.96B4.26B54.99B3.98B3.10B
EBITDA4.46B4.96B2.50B2.35B1.95B1.30B
Net Income362.15M86.42M278.72M629.09M686.43M245.70M
Balance Sheet
Total Assets38.61B45.23B33.35B31.95B32.06B26.70B
Cash, Cash Equivalents and Short-Term Investments1.57B3.33B3.58B4.81B4.32B3.12B
Total Debt16.19B23.09B16.39B16.27B16.71B14.16B
Total Liabilities31.48B37.91B25.68B23.87B25.28B20.67B
Stockholders Equity6.93B7.01B7.33B7.66B6.77B5.96B
Cash Flow
Free Cash Flow-1.55B-5.98B-1.03B153.20M-2.96M-757.46M
Operating Cash Flow-875.02M-5.32B-334.60M964.60M690.50M-78.50M
Investing Cash Flow-630.61M-618.80M-580.19M984.76M-1.72B-513.70M
Financing Cash Flow1.29B5.37B-214.37M-1.34B2.36B610.71M

Olam Group Technical Analysis

Technical Analysis Sentiment
Positive
Last Price0.94
Price Trends
50DMA
0.94
Positive
100DMA
0.95
Positive
200DMA
0.97
Positive
Market Momentum
MACD
0.01
Negative
RSI
64.01
Neutral
STOCH
71.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:VC2, the sentiment is Positive. The current price of 0.94 is below the 20-day moving average (MA) of 0.94, above the 50-day MA of 0.94, and below the 200-day MA of 0.97, indicating a bullish trend. The MACD of 0.01 indicates Negative momentum. The RSI at 64.01 is Neutral, neither overbought nor oversold. The STOCH value of 71.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:VC2.

Olam Group Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
S$516.48M5.378.46%2.67%13.03%35.10%
69
Neutral
$22.47B14.315.86%4.55%3.92%-25.13%
67
Neutral
S$2.60B11.7020.72%6.82%15.89%21.52%
62
Neutral
$20.33B14.63-3.31%3.23%1.93%-12.26%
62
Neutral
S$3.81B6.808.32%2.87%16.86%252.80%
52
Neutral
S$3.78B10.923.56%5.26%-11.89%50.41%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SG:VC2
Olam Group
0.99
0.04
4.21%
SG:E5H
Golden Agri-Resources
0.29
0.05
20.33%
SG:F34
Wilmar International
3.50
0.44
14.23%
SG:P8Z
Bumitama Agri Ltd.
1.33
0.61
84.21%
SG:5JS
Indofood Agri Resources Ltd.
0.38
0.08
25.00%

Olam Group Corporate Events

Olam Group’s ofi Secures $1.12 Billion Loan Facility
Dec 10, 2025

Olam Group’s subsidiary, olam food ingredients (ofi), has secured a US$1,120 million dual currency loan facility to refinance existing loans and support general corporate purposes. This financial move, involving 12 banks and structured in multiple tranches, positions ofi for growth and stability ahead of its planned IPO and demerger, potentially strengthening its market presence.

The most recent analyst rating on (SG:VC2) stock is a Hold with a S$1.00 price target. To see the full list of analyst forecasts on Olam Group stock, see the SG:VC2 Stock Forecast page.

Olam Group Announces Board Restructuring
Nov 24, 2025

Olam Group Limited has announced changes to its Board of Directors, effective from November 24, 2025. Mr. Nagi Hamiyeh has resigned as a Non-Executive Director and member of the Board Executive Committee, with Mr. Dinesh Khanna stepping in as his replacement. These changes are expected to impact the company’s governance structure, potentially influencing its strategic direction and stakeholder relationships.

The most recent analyst rating on (SG:VC2) stock is a Hold with a S$1.00 price target. To see the full list of analyst forecasts on Olam Group stock, see the SG:VC2 Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 31, 2025