Roto-Gro Progressing Well As Emerging Cultivator Of Lawful Cannabis And Perishable Foods

  • Jun 25, 2019 AEST
  • Team Kalkine
Roto-Gro Progressing Well As Emerging Cultivator Of Lawful Cannabis And Perishable Foods

Roto-Gro International Limited (ASX: RGI) is focused on cultivating lawful cannabis and perishable foods ; the market for both is expected to increase significantly in the immediate future. As per the Market & Market report, the perishable food (produce) market is expected to reach $295 billion by 2022, whereas the global lawful cannabis market is expected to reach $146 billion by the end of 2025. With its world-class facility design and patented and proprietary technology, Roto-Gro International intends to establish itself as a significant player in the lawful cannabis and perishable foods space.

The company’s patented and proprietary RotoGro Hydroponic Garden Systems is known for delivering cost and yield advantages, which helps RGI in differentiating itself from competitors. In addition, the company’s proprietary automated iGrow® software monitors all aspects of the growing environment and nutrient recipes in real time. The company intends to earn revenue by selling its proprietary technology to third-party growers.

The company currently is in the process of acquiring Supra THC Services Inc., a wholly-owned subsidiary of Valens GroWorks Corp (CSE:VGW), which holds a Health Canada issued Dealer’s License for possession of cannabis and related active ingredients. To complete the acquisition, the company now requires all requisite corporate and regulatory approvals, for which it has been working with Cannabis Compliance Inc., Health Canada and Valens.

RotoGro will convert the Dealer’s License under the new Cannabis Act to permit additional processing and cultivation methods at a new 44,000 sqft cultivation facility located near RotoGro’s existing research, development and manufacturing facility in Caledon, Ontario, Canada. The company employed senior executives and engaged Cannabis Compliance Inc. to advise on the regulatory matters, convert the Dealers’ License to a Standard Processing License and add cultivation to the Facility. The company is hopeful of first cultivation in 2019.

The completion of this acquisition will be a major milestone for the company as it will place RotoGro at the forefront for the cultivation of lawful cannabis.

In an update provided on 24th June 2019, the company informed that its sales pipeline has been growing while its customer leads remained strong and that it is currently working on two design and technology proposals.

Along with this, the company also started working with Siksika Herbz GP Inc., where it is currently involved in designing Siksika’s floor plans as per Health Canada standards and applicable building codes.

In the month of April 2019, Roto-Gro World Wide (Canada) Inc., which is a wholly-owned subsidiary of Roto-Gro International Limited, secured a $600k order from Frozen Penguin Medical Industries Inc. and received 50% of the purchase price from Frozen Penguin as a deposit for the order. The delivery for this order is scheduled for early Q3 CY 2019.

Frozen Penguin’s R&D consultants / RotoGro Crops (Source: Company Reports)

In parallel, the company also installed and commissioned a second grow room of 24 units for Miracle Valley Medical Alternatives M.V.M.A. Ltd with regards to its $2.3 million purchase order announced in April 2019.

During the March quarter, the company’s wholly-owned subsidiary, Global Fertigation Solutions secured more than $500,000.00 of new sales from both internal and external sales leads.

With the help of its design and innovation team, the company is building a production-ready rotational garden system for perishable foods and in addition, the company recently installed its first LED prototype into the trial, which is expected to reduce electricity draw.

For a company like Roto-Gro International Limited whose success is highly dependent on its proprietary technology, it is very important to have a research and development team in place to help the company in further improving its efficiencies and gaining competitive advantage. The company confirmed that its research team made significant progress while studying a variety of new strains for yield and quality optimisation for its RotoGro Hydroponic Garden Systems with recent trials indicating consistent yields of 7 to 9 pounds per rotational garden system every 60 days together with the consistent levels of THC and CBD.

On 3rd May 2019, the company issued 16,658,380 shares to institutional and sophisticated investors to raise $3,581,552 (before costs) to fast-track the expansion of its research and development facility in Caledon, Ontario, Canada. Further, the company will use the proceeds to expand its production inventory to lower down the production costs. This placement received strong support from new and existing investors, which is a testament to the unique opportunity RotoGro presents in revolutionising the future of agriculture.

The company is currently pursuing a dual listing on the Canadian Securities Exchange, in line with the company’s focus on the cultivation of lawful cannabis in Canada and other lawful jurisdictions.

RotoGro aspires to be a leading lawful cannabis and perishable foods grower; its patented and patents-pending technology and proprietary growing management software, sets it apart from all other methods of growing.

At market close on 25th June 2019, the company’s stock was trading at a price of $0.150, with a market capitalisation of $19.48 million. Its 52 weeks high price stands at $0.555 and 52 weeks low price at $0.125, with an annual average volume of ~238,855.


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