Pot company PhytoTech lights up stock market, quadrupling on IPO
Friday, January 23, 2015/
Product shots for medical marijuana company PhytoTech
The founders of medical marijuana company PhytoTech might be seeing double this morning, but not because of their products.
After a smoking hot debut on the Australian Securities Exchange yesterday, PhytoTech’s initial offer price has now more than quadrupled.
After a strong year of listings in 2014, the pot producers are one of the biggest share market success stories of the past 12 months.
The Perth-based company, which wants to develop medical-grade cannabis products for overseas markets, raised $5.9 million this month through an oversubscribed initial public offering, offering 20 cents per share. PhytoTech listed yesterday at 32 cents a share and is currently trading at 90 cents a share.
The high share price gives the company a market capitalisation of $14.47million.
The first medical-grade cannabis company to list on the ASX, PhytoTech said in its prospectus the IPO will position it to become the leading Australian player in the space.
PhytoTech has partnered with $2 billion Israeli technology transfer firm Yissum to develop its products and plans to leverage the partnership in the international market.
Ross Smith, founder and executive director of PhytoTech, said in a statement to SmartCompany, medical cannabis is a paradigm shift as an investment opportunity in the Australian market.
“Today we saw professional investors buying relatively cheap shares from weak stage profit takers,” said Smith.
“I believe that we will look back in 12 months time and PYL will be the best performing ASX listed stock.
“There’s a new sheriff in town, called medical cannabis.”
“Medical cannabis is fast becoming accepted as a treatment for a variety of medical conditions around the world and the success today is an encouraging sign that investors have confidence in our strategy, technology and business model,” added Phytotech chairman Peter Wall.