Godsent Ogbebor
Analyst Raphael Famuyiwa Says Lafarge’s Innovation and Strong Returns Show Undervalued Strength
A finance analyst, Raphael Famuyiwa, has described Lafarge WAPCO as one of the most undervalued companies in Nigeria’s cement industry.
Citing the firm’s product innovations, strong capital efficiency and rising earnings as signs of a business that is performing far above its current market valuation.
Famuyiwa, an investment and portfolio manager with over eight years of experience in quantitative research, said Lafarge has built a competitive edge by combining cost discipline with product differentiation.
He explained that the company’s wide product mix, including over seven specialised cement types, allows it to serve different needs across construction and manufacturing.
He noted that Lafarge’s Watershield cement, designed to prevent water seepage, and its customised product for roof tile production highlight the company’s ability to create solutions that address daily challenges in the sector.
He added that the company’s SRC product, which is formulated for areas with high sulfate soil content, further shows a commitment to engineering targeted solutions.
Famuyiwa said Lafarge’s Geocycle operations, which collect waste from municipalities for use as fuel in cement plants, strengthen its cost management by reducing energy expenses while supporting environmental sustainability.
According to him, the company’s capital efficiency stands out in the industry, pointing to its 82 per cent return on invested capital, which he described as higher than the combined levels reported by Dangote and BUA Cement.
Read also: Analyst Famuyiwa Highlights BUA Cement’s Long-Term Strength Despite Profit Dip
He said that while many firms rely on rapid expansion to drive value, Lafarge’s ability to generate high returns from its existing operations already places it ahead of its peers.
He added that Lafarge’s full-year 2024 performance reflected this strength, with the company reporting 72 per cent revenue growth and a 50 per cent rise in gross margin.
He also noted that its cash flow position, which stands at 331 per cent of its debt, shows a business with strong liquidity and low financial pressure.
Famuyiwa said valuation metrics further indicate the company is trading below its worth. He pointed out that Lafarge’s net operating profit after tax accounts for 22 per cent of its enterprise value, compared to 7 and 8 per cent for BUA and Dangote.
He added that while its competitors trade at an average EV/NOPAT of about 13 to 14, Lafarge trades at around 5, which he said reflects clear undervaluation.
He explained that the company’s half-year 2025 results show continued momentum, with revenue rising by 39 per cent and gross margin up by 49 per cent compared to the same period in 2024.
He said the company’s decision to reinvest earnings rather than prioritise dividend payouts demonstrates disciplined management aimed at strengthening long-term performance.
Famuyiwa said Lafarge’s combination of innovation, cost management and reinvestment strategy makes it a value opportunity for investors who are looking for a company trading below its intrinsic worth.
Raphael Famuyiwa is a finance leader with over 8 years of experience in portfolio management and quantitative research. He founded Ocean-Ways Partners (2023-2025), outperforming benchmarks.
He currently serves as Group Head of Investment & Portfolio Manager at Prodigy Investment (Aug 2025-Present). He developed a derivatives platform integrating 3 derivatives pricing method.
He holds an ACCA via LSBF’s (London School of Business and Finance) integrated MBA
