India Globalization Capital, Inc. (NYSEMKT:IGC) has seen a significant increase in daily volume over the last few weeks climbing roughly 700%. New and existing shareholders and investors are showing renewed interest in IGC as its share price has doubled climbing from the depths of $0.16 to $0.32. Quite a surge for a microcap company like IGC.
According to its company profile, IGC is taking defensible, high growth, high margin positions in two of the world’s fastest growing industries. Its two core focuses and involvement is in the electronics and cannabis industries. IGC is betting that its positions will be highly profitable in the short and long term. It is focusing on developing and commercializing a portfolio of cannabinoid based biopharmaceutical therapies for end of life supportive care, hospice care, and chronic neurological and oncological diagnosis.
From an Electronics perspective, the company is developing a strategy around the Internet of Things. This is a huge growing market and a hot buzzword that has made significant headway. There is a technology revolution when it comes to IoT electronics and healthcare monitoring. IGC is going to be at the epicenter and attempt to break into the industry in a big way. As for cannabis, it is one of the fastest growing industries and will continue to pick up pace as more states within the USA begin legalizing the once infamous drug that was the center of the “Drug War.”
There are some significant obstacles that are facing IGC at the moment. First, its designation on a major index, the NYSE, is in jeopardy and it has received a delisting notice from the exchange. It is likely that IGC will have to delist and move to the OTCBB or a lesser exchange which reduces investor visibility and could impact its ability to raise capital. IGC announced that it has raised roughly $600k in private direct equity funds last week. Approximately 2 million shares were purchased.
IGC’s financial performance has been lumpy to say the least. Revenue has been far from consistent jumping and declining significantly from quarter to quarter. The company is trading below its equity book value which could show that if the company were to liquidate shareholders would potentially come out ahead. Book value is around $13M which is much higher than its current market valuation of $5.7M. This may offer investors some upside but could be limited if losses continue and investments in these industries do not pay off.
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IGC is currently trading at a $5.7 million market valuation. The company has made some advancement in the last few weeks and its stock price has done a reversal off a double bottom which is a relatively powerful technical indicator. IGC seems to have reset is business strategy and if it can find room to play in the cannabis sector or internet of things, there could be exciting news coming soon. Be sure to stay tuned!
We will be updating on IGC when more details emerge so make sure you are subscribed to Microcapspot so you know what’s going on with IGC.
Disclosure: we hold no position in IGC either long or short and we have not been compensated for this article.
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