Why the Australian Primary Hemp (ASX:APH) share price is up 5%

The Australian Primary Hemp Ltd (ASX: APH) share price is on the move following the announcement of a distribution agreement. Here are the details.

Aaron Teboneras

Author bio Aaron Teboneras is an ASX investment writer with a background in business, marketing and finance. He has been a contributor to The Motley Fool since 2020, covering market news, company announcements, broker views and financial results. Aaron’s previous notable appointments include National Australia Bank, and Computershare where he discovered his passion for the Australian sharemarket. Aaron has been investing for almost 20 years, using both fundamental and technical analysis to find opportunities. Aaron completed a Technical Analysis course with Mint Analysis in 2022 and is currently studying Training and Assessment. Outside the market, he has travelled to more than 45 countries and enjoys trekking, meeting new people and seeing different parts of the world. Areas of expertise ASX growth shares Founder-led companies Company announcements and financial results Fundamental and technical analysis Education Bachelor of Business from RMIT University Social media LinkedIn Instagram Favorite investment quote “If you don't find a way to make money while you sleep, you will work until you die.” — Warren Buffett

Published April 20, 2021 10:53 am AEST

The Australian Primary Hemp Ltd (ASX: APH) share price is on the rise following the announcement of a new distribution deal.

At the time of writing, the company's shares are swapping hands for 39 cents, up 5.41%.

rising asx share price represented by woman jumping in the air happily — Image source: Getty Images

What did Australian Primary Hemp announce?

Investors are sending Australian Primary Hemp shares higher after digesting the company's latest positive update.

According to this morning's release, Australian Primary Hemp secured its largest retail distribution agreement with Coles Group Ltd (ASX: COL).

Under the deal, the supermarket giant will range 5 additional Mt. Elephant products from Australian Primary Hemp. It is expected that the new inclusions will be available for purchase in stores from July 2021.

Australian Primary Hemp estimates that the agreement will generate roughly $3 million in revenue per year.

The latest news follows the successful relationship between both parties. In early March, Australian Primary Hemp signed its first retail distribution agreement with Coles to stock its Mt. Elephant 'mylk' hemp and oat milk range.

Australian Primary Hemp managing director and CEO Neal Joseph commented:

APH's Mt. Elephant brand was developed to focus on capturing the demand for high-quality, plant-based 'superfood' products – with Australian-farmed hemp used in all our products.

This latest agreement with Coles represents APH's largest retail distribution agreement with any retail partner, and we are proud to see Coles recognise the Mt. Elephant product range. We look forward to further potential agreements in the future as we further our Company's development in becoming a producer, manufacturer, and distributor of premium hemp-based products.

Australian Primary Hemp share price snapshot

Over the last 12 months, the Australian Primary Hemp share price has gained around 190%, with year-to-date up 17%. The company's shares reached a multi-year high of 62 cents earlier this year, before treading lower.

On valuation grounds, Australian Primary Hemp commands a market capitalisation of approximately $27 million, with 75 million shares outstanding.

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