- The Canadian Transport Agency has granted a licence to Drone Delivery Canada (TSXV:FLT).
- This licence Drone Delivery to scale up its business operations.
- Investor interest in the drone company seems to be on the rise following this development.
Investor interest in Drone Delivery Canada (TSXV:FLT) seems to be on the rise as the publicly traded drone delivery company has become the first of its kind to receive a Canadian Transport Agency Licence.
As the announcement came in on Tuesday, July 27, Drone Delivery stock shot up by nearly 12 per cent to close at C$ 1.35 apiece.
This licence from the Canadian Transport Agency (CTA) allows Drone Delivery to scale up its business operations. Generally, the CTA licence is issued to cargo services or passenger airlines.
Why is CTA licence important?
In Canada, a CTA licence is mandatory for operators to provide commercial air services.
Being the first drone delivery company to receive this licence, Drone Delivery Canada is now expected to be equipped to work on sustainable delivery operations and address logistical challenges in the country.
It is also likely to help the enterprise expand its ongoing operations, such as the partnership with Edmonton Regional Airports Authority, to set up the world's first drone delivery hub.
Michael Zahra, CEO of Drone Delivery, has said that obtaining the CTA licence is a key milestone for the company and it will ensure providing critical services to the clients in future.
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Drone Delivery (TSXV:FLT) stock performance
Established in 2014, Drone Delivery has emerged as one of the leading drone logistics companies. The Toronto-based company's disruptive technology is said to have the potential to reach remote communities and help save both time and money.
Drones can reshape the traditional logistics industry as they are more cost-effective. This could see the drone industry expand in the coming nears.
Drone Delivery, on the other hand, could go on to score more new clients as more users look to minimize their shipping time and reduce operational costs, which will allow partner companies to expand their bottom lines and increase revenues.
At the end of the trading session on Tuesday, July 27, FLT stock was trading 47 per cent lower than the 52-week high of C$ 2.55 per share (February 10, 2021).
The present price could be used as an entry point as the scrip’s price is expected soar in future.
FLT share soared by about 71 per cent in the past month and expanded by 64.6 per cent year-to-date (YTD).
For the period ended March 31, 2021, Drone Delivery's cash and cash equivalents stood at C$ 35.2 million, up from that of C$ 23.5 million for the year ended December 31, 2020.