The Business Case for Investing in the Hulling and

Transcript:The Business Case for Investing in the Hulling and:
The Business Case for Investing in the Hulling and Export of Sesame Seeds in Ethiopia Investor Presentation May 2012 Opportunity Definition Objective of this Document Hulling and Export of Sesame Seeds Introduction This investment case has been prepared by the Monitor Group as part of Ethiopia’s presentation at the Grow Africa Forum. The intended audience are Regional and International investors who are looking for strategic or financial investments in Sub-Saharan Africa. The investment opportunity identified is the establishment of a sesame hulling plant with an annual output capacity of 10,000 MT through a joint venture agreement with a local partner in Ethiopia. The high quality hulled sesame seed produced would be packaged and exported to international purchasers for use in bakery and confectionary applications. An initial investment of $7.0 million is projected to return an IRR of 40% without leverage after five years. Note: This investment case was prepared by Monitor Group, an independent, global management consultancy firm. Funding for the investment case analysis was provided by the U.S. Agency for International Development as technical assistance to the Ethiopian Agricultural Transformation Agency Its findings are based on public and proprietary information, as well as information gathered by Monitor Group through field investigation and qualitative interviews with industry experts and other key stakeholders. Monitor Group does not make any representation or warranty, express or implied, as to the accuracy, completeness, or correctness of the information contained herein, nor does it accept any liability for any loss or damage, howsoever caused, arising from any errors, omissions, or reliance on any information or views contained in this document. Monitor Group is not a financial advisor; therefore, this document does not represent financial advice. Competitive Advantages Investment Highlights Market Opportunity Hulling and Export of Sesame Seeds Summary 1 2 3 Ethiopia is the world’s 3rd largest sesame exporter, sourcing 14% of the global market for raw seeds. These seeds are then processed abroad Sesame is one of Ethiopia’s highest value crops, earning $1,330 / MT raw. Hulling sesame domestically would add revenue of $180-200 / MT Current domestic processing capacity is limited, presenting a significant opportunity to establish a high quality value addition hulling facility Ethiopia is one of the fastest growing economies in Africa Political stability and ongoing government infrastructure investments Large domestic market, and good access to regional and international export markets Investors benefit from good agro-climatic conditions and generous investment incentives