The Hydroponics Company Ltd (ASX: THC) share price has risen by 5% today on an update regarding Canadian expansion.
Hydroponics Company is one of the larger pot stocks on the ASX and has grown strongly along with the rest of the industry in recent times.
Today, the business has advised that it has appointed accounting and legal advisors to commence due diligence on a Canadian acquisition. When the acquisition is completed it is expected that the Canadian's company revenues will be in excess of C$20 million per annum.
The acquisition will compliment the existing Crystal Mountain-Dragon Vision (CMDV) business and provides exposure to the growing Licenced Producers in eastern Canada.
Management also said that CMDV is trying to boost organic growth opportunities with new agencies to the portfolio. The business has updated its website to better reflect this increased portfolio.
The Hydroponics Company CEO, David Radford, said "upon completion of this acquisition The Hydroponics Company will offer an extensive range of products for the Canadian cannabis market. This growth of the Canadian company was identified in October as being a strategic imperative and I am pleased with the progress being made in executing this strategy".
If this acquisition succeeds it will complete in late April 2018. The company will continue to look for further opportunities, both acquisitive and organic to drive growth in the Canadian market.
Foolish takeaway
The share price has risen by 49% over the past month and could keep rising if more positive announcements like this one happen in regards to Canadian expansion.
I'm not a buyer of pot stocks at the moment, I think there's too much hype for how much revenue is on the horizon in the near term. However, in the long-term these prices may be justified.
