India Globalization Capital (IGC) Stock Rockets On Hemp News

India Globalization Capital IGC Stock News

India Globalization Capital, Inc. (NYSEAMERICAN: IGC) is having an overwhelmingly strong day in the market today with gains of more than 50%. The gains come after the company announced that it will be taking part in the Industrial Hemp Program in Arizona.

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IGC Stock Gains On Industrial Hemp News

In a press release issued early this morning, India Globalization Capital announced that its subidiary’s application to grow and harvest hemp has been approved. Holi Hemp, a wholly-owned subsidiary of IGC, received the approval under the terms and conditions of the Industrial Hemp Program that was developed by the Arizona Department of Agriculture.

As a result of the approval, Holi Hemp can now estabish a hemp growing operation in Arizona. Of course, this is an important step on the company’s path that sets the foundation for CBD brand development, fulfilment and growth.

In a statement, Ram Mukunda CEO at IGC, had the following to offer:

We selected Arizona after much analysis including assessing climate, cost of labor, political environment, local support, logistics, market penetration, and competition, among other factors. IGC intends to employ a strategy to plant year-round that reduces the amount of requisite acreage while taking full advantage of the hot weather to land dry the bio-mass. Our plan will focus on about 100 acres for extraction with additional acreage set aside for R&D initiatives.

We anticipate having an extraction facility built in time for the November 2019 harvest but various factors, for example building permits, could cause a delay. If we are able to execute on our plans, one acre of hemp can potentially yield about 2,000 Kgs of dry flower that can potentially be extracted and refined into approximately 50 Kgs of THC-free CBD distillate with a current market value of $5,500 to $7,000 per Kg.

Why This Is Important

At the end of the day, all of the excitement surrounding India Globalization Capital is happening for a good reason. While the CBD industry is already a booming one, it is still emerging and growing rapidly.

In fact, estimates suggest that the global CBD market could climb to be worth more than $20 billion by the year 2022. With a market cap of around $50 million, an entrance into this high dollar industry could lead to incredible value creation for the company and its shareholders.

It’s also important to remember that the dynamics of an emerging market are very different from those of a developed one. The truth of the matter is that those that make investments in infrastructure early on in emerging markets generally become the leaders in the long run when these markets become developed.

Keep in mind, CBD and Hemp were just recently legalized late last year with the passing of the 2018 Farm Bill. So, the market, especially here in the United States, is in its infancy, making now the time to make moves. With IGC getting its feet wet with a growth facility that’s expected to be completed in November, the company is one of the early players that has the potential to become a long-run leader.

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Final Thoughts

With today’s announcement, the value provided through an investment in India Globalization Capital is hard to ignore. The company’s early moves in the hemp industry could help it to take a decent share of a market that it expected to grow rapidly in the coming years. As such, now may be the time to consider an investment in the stock.

What Do You Think?

Where do you think IGC stock is headed moving forward? Join the discussion in the comments below!

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