Chemesis International (CSI) Bolsters its Presence in California

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Chemesis International Inc. (CSE: CSI; OTC: CADMF) continued to see its share price increase on Monday morning after announcing plans to expand its footprint in California.

Today it announced that it will bolster its presence in California with the launch of a 25,000 sq. ft. expansion to its production facility in Cathedral City. “Chemesis believes this additional manufacturing will not only allow us to increase our capabilities to produce finished goods, but also allow us to further expand our presence in California,” said Montero.

Chemesis’ stock has shot up from C$1.38 to C$2.05 in the past month.

A month ago shares in the firm were trading at C$1.38, but the price has since increased significantly amid a raft of news releases. It reached $1.95 by the end of last week and opened at $2.02 today before climbing up to $2.05, with a market cap just north of $62 million.

That is comparatively tiny when you put it next to Canopy Growth Corp. (TSE: WEED) and Aurora Cannabis (TSE: ACB), whose markets capitalizations currently stand at $20.5 billion and $10 billion respectively. These large-cap firms dominate the news agenda: Aurora just announced its first shipment of CBD oil to the UK, while its Q2 financial results, to be released after trading closes today, will be pored over by analysts.

Yet Chemesis is ambitious and it has been making a lot of noise itself over the past month. On Jan. 14, it announced the launch of a beverage division in Puerto Rico. It owns a 100,000 sq. ft. cultivation plot and 35,000 sq. ft. manufacturing facility on the island, via a subsidiary called Natural Ventures, which supplies 90% of Puerto Rico’s dispensaries. It is also producing an edible called Dragonglass Flake and Bake for GSRX Industries, one of Puerto Rico’s largest dispensaries while producing high-potency CBD strains on the island.

On Jan. 28, it announced plans to create a GMP-certified production facility in Bogota, Colombia, via another subsidiary, La Finca Interacviva-Arachna Med. It has more than 1,000 acres on which to cultivate marijuana in the area and it hopes to “leverage a first mover advantage” in Colombia, where there is currently a scarcity of certified extraction facilities. It is also continuing a partnership with the National University of Colombia to research ideal seed strains per climate, harvesting techniques, ideal densities for biomass and yield improvement.

Chemesis is putting its hopes on a brand called Jay and Silent Bob’s Private Stash.

Chief executive Edgar Montero has declared that Colombia is coming along nicely for the company, but that California is crucial to its strategy. Chemesis is putting its hopes on a brand called Jay and Silent Bob’s Private Stash, which take inspiration from the characters played by Jason Mewes and Kevin Smith in a number of Smith’s hit movies.

He claims that the Jay and Silent Bob brand and its other labels have already gained “significant interest” from consumers and retail buyers, and that it needs to increase its production capacity to meet growing demand.

The steady stream of news has helped increase the company’s share price, although it is worth noting that most cannabis stocks have increased during the past month as the sector has rallied from a tough November and December. Chemesis has a relatively small market cap, and it could be prone to volatility, but it is currently on an upward march. Within an hour of trading on Monday morning it was up to C$2.07, an increase of exactly 50% on the $1.38 it commanded a month ago.

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The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

Martin Green
Martin Green is an experienced journalist with a strong focus on the cannabis, alcohol, and gambling industries. He is particularly interested in the political issues affecting the global marijuana trade, and he has a keen focus on regulation changes and legal topics. He holds a BA English Literature, MA Creative Writing and a National Qualification in Journalism diploma. He has worked in journalism since 2009 and written for a broad range of newspapers, business titles and magazines, including The Sun, The Metro, The Journal, Livestrong, Drinks Retailing News, Harpers, Sportsbook Review, Vital Football, Essex Live and Surrey Live. Address: 682 Indian Road, Toronto, Ontario, M6P 2C9. Phone: 416-721-8257.
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