TORONTO, Oct 20 (Reuters) - Canada’s nascent medical marijuana sector was higher on Tuesday after Canada’s Liberal leader Justin Trudeau, who would like to legalize marijuana, won a historic victory in the federal election.
Shares of some of the better-recognized companies surged after the Liberal sweep. TSX Venture-listed Canopy Growth Corp , the first company to go public in the sector in Canada last year under the name Tweed Marijuana, rose some 9 percent to C$2.37. Mettrum Health Corp and Aphria Inc, jumped 8 percent and 5 percent, respectively.
“Everyone was preparing for the day that this would become a legalized market and was trying to build strong brands that had the visibility for when it was recreational, so that they can take their medicinal business and rapidly export their brands into a recreational market,” said Dundee analyst Aaron Salz.
With Liberals winning a majority, it was likely to create even more impetus since the legalization process would not be stymied by partisan politics, he said.
If marijuana is legalized, Salz expects marijuana sales in the medical market in Canada to jump from some C$80 million to C$100 million now to well over C$2 billion in a larger recreational market.
“The Liberals have emphasized their desire to legalize, regulate, and tax marijuana, and with the majority government now in place, this is obviously positive for the publicly listed licensed producers,” said M Partners analyst Daniel Pearlstein. (Additional reporting by Alastair Sharp; Editing by Jeffrey Benkoe)