IPO Watch: Emerald Clinics is the latest pot stock to wilt on its ASX debut
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Emerald Clinics (ASX:EMD) has had a rough start to listed life, dropping 30 per cent in its first hour on the ASX.
It ended its first session at 14.5c — a 25 per cent discount to its 20c IPO price.
Emerald is the second pot stock in a row to drop after lighting up the ASX boards.
On the upside, Emerald still raised $6m in its IPO and has plans to grow its business.
Like some other cannabis companies, it has a network of clinics but the difference is it makes its money from selling data that can be used to evaluate the safety and efficiency of cannabinoid medicines.
It has four clinics in Australia and with the IPO money it hopes to expand its clinics. It also will conduct clinical trials and seek out new customers for its data.
One existing client is Spectrum Therapeutics, the medicinal division of the world’s largest cannabis company, Canopy Growth (NYSE:CGC).
“We believe robust and ethically-sourced clinical evidence is vital for medicinal cannabis to be considered a mainstream medicine and Emerald is well positioned to be a key supplier of this information covering appropriate prescribing and safe monitoring,” CEO Michael Winlo said.
Also this morning, the company announced a new board member — famous British scientist and physician Sir John Tooke.
Dr Winlo said he would be integral to Emerald’s plans to expand into the UK.