Levubu Root Business Plan

Investor-ready ginger and certified seed business plan: R36.0m equity, 88 commercial hectares, 2,422 t fresh and R83.7m FY2031 revenue.

Levubu Root Company — fresh ginger rhizome of the kind graded for market and seed

Business Plan & Investment Proposal · South Africa

Ginger Farming Business Plan — South Africa

Levubu Root Company (Pty) Ltd · You Must Control The Land You Cannot Plant.

Commercial ginger production in the Levubu valley with an integrated clean seed block
— 88 hectares of commercial ginger and 24 hectares of certified seed by FY2031, supported by 504 hectares
of controlled land held under rotation, producing 2 422 tonnes of marketable fresh ginger and
271 tonnes of certified seed. R36.0 million of equity for 61.7 per cent of the company, alongside a
seasonal facility peaking at R26.1 million.

R36.0mEquity sought

504 haControlled to plant 88

R83.7mFY2031 revenue

30.3%FY2031 EBITDA margin

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Ginger has a cost shape no other South African field crop shares, and this plan is
built around it. Ginger cannot follow ginger: a long rotation is required to keep soil-borne disease out, which
means 504 hectares must be controlled and paid for in order to plant 88 — roughly one hectare in six, with
the rest resting and earning nothing. That is why a ginger venture cannot simply plant more when it wants to grow.
The second constraint is seed. Planting rhizome dominates establishment cost, and in FY2027 the company loses money
on every hectare, at a gross margin of minus 24.7 per cent, because it is buying that seed. A 24-hectare clean
seed block changes the arithmetic: by FY2031 gross margin reaches 46.3 per cent and 271 tonnes of
certified seed are sold to other growers, turning a necessary input into a second revenue line.

The plan at a glance

Six measures that determine whether this venture and its funding stand up.

504 haControlled to plant 88Ginger demands a long rotation, so roughly six hectares must be held for every one planted. Land the company cannot plant still has to be paid for.

R36.0mEquity soughtFor 61.7% of the company, alongside a seasonal facility peaking at R26.1m to fund the planting season.

24 haClean seed block at FY2031The reason the margin moves. Certified seed grown in-house replaces bought rhizome, which dominates establishment cost.

–24.7% → 46.3%Gross marginThe swing is seed. FY2027 loses money on every hectare because the rhizome is purchased rather than grown.

271 tCertified seed sold at FY2031A second revenue line sold to other growers, from a seed block that exists primarily to supply the company itself.

2.45x / 27.5%Base case MOIC and IRROn a plan where profit after tax only turns positive in FY2029 and DSCR is negative for two years.

The land that earns nothing

How much land a ginger venture must hold against how little of it can carry the crop in any season.

504 hectaresControlled and paid forGinger cannot follow ginger. A long rotation means land sits out of the crop for years at a time, and it still carries cost while it does.

to plant

88 hectaresOf commercial gingerRoughly one hectare in six. That ratio is why a ginger venture cannot simply plant more when it wants to grow, and why land control is the binding constraint.

Five years of trading

Revenue and EBITDA on the base case. Yield per hectare and the seed cost are the two assumptions that matter most, and both are stressed in Section 24.

Revenue build — hectares planted against hectares controlled

Commercial ginger rises from 20 hectares to 88, but land controlled rises from 126 to 504. Rotation means roughly six hectares must be held for every one planted.

FY2027

R11.31m · 20 ha · 126 ha held

FY2028

R23.09m · 34 ha · 207

FY2029

R38.72m · 50 ha · 297

FY2030

R58.85m · 68 ha · 396

FY2031

R83.70m · 88 ha · 504

EBITDA and margin, FY2028 onward

FY2027 runs a deficit of R7.21m, with gross margin at minus 24.7% while the seed block is built. Margin then climbs to 46.3% as the company stops buying rhizome and starts growing its own.

FY2028

R0.67m · 2.9%

FY2029

R5.62m · 14.5%

FY2030

R13.81m · 23.5%

FY2031

R25.34m · 30.3%

Why this plan works the way it does

You must control the land you cannot plantGinger cannot follow ginger. A long rotation means 504 hectares are held to plant 88 — roughly one in six — and the resting land carries cost while producing nothing. This is why a ginger venture cannot simply plant more.

Seed is the cost that decides the marginPlanting rhizome dominates establishment cost per hectare. Gross margin swings from minus 24.7% to 46.3% largely because the company stops buying seed and starts growing it in a 24-hectare clean block.

The seed block is a business as well as an input271 tonnes of certified seed are sold to other growers by FY2031, from a block built primarily to supply the company. A necessary cost centre becomes a second revenue line.

Disease risk is what the rotation buysLong rotation and certified clean seed exist to keep soil-borne disease out. That discipline is expensive and it is the whole reason the cost structure looks the way it does.

Two hard years before it turnsFY2027 loses R7.21m at EBITDA with a negative gross margin, and profit after tax turns only in FY2029. Debt service cover is negative for two years before reaching 3.89x.

Financial snapshot

Four charts from the plan. The full set of twenty-four appears throughout the sections below.

Figure 2. Land controlled against land planted, showing the rotation requirement that drives the lease footprint.

Figure 1. Establishment cost per hectare at FY2031, split between planting rhizome and all other field costs.

Figure 3. FY2031 value of the surplus rhizome sold as certified seed against the same tonnage sold as table ginger, net of the seed block cost premium and conditioning cost.

Figure 5. Change in FY2031 EBITDA against the base case of R25.34m, ranked by magnitude.

Twenty-six sections and four appendices. Every page carries full navigation, a section outline and links to the sections either side of it.

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Executive SummaryBasis of preparation, data sources and forward-looking statement caveats. Please read first.

Appendices

Confidential. This document is provided for the purpose of evaluating an
investment in Levubu Root Company (Pty) Ltd and may not be reproduced or distributed without written consent. Projections are
forward-looking statements based on the assumptions registered in Section 16 and are not guarantees of future
performance.