Viking Minerals, Inc. (OTCMKTS:VKML) Crashes Despite MMJ Deal

Viking Minerals, Inc. (OTCMKTS:VKML) seemed just on the verge of a revival when it suddenly crashed, upturning all logic. Right on the day when VKML sent out a PR message about its latest forays into legal marijuana, the stock price tanked by more than 56% to $0.04, as selling expanded to $2.2 million. In general, the OTC trading for marijuana companies was subdued, as not even the most active tickers managed to vault the $7 million daily trading levels. On better days, staple selections routinely posted double-digit dollar volumes. VKML0410.png

The latest news is that VKML has “acquired” Indie Growers Union LLC, a Washington-based marijuana company. Technically, the deal is a share exchange, with VKML issuing 87.5 million new shares to absorb the capital of Indie Growers Union.TRTC0410.png

Last time we met VKML, we warned of the upcoming crash- but the market managed to hang on for a few more days. This may have created some hopes around the company, but in the case of VKML, the past financial history reveals still zero cash and assets, as well as:

  • $105,000 total current liabilities, up from $64,000 in 2012
  • Still zero revenues
  • $15,000 quarterly net loss for the last quarter of 2013

Unfortunately, the stock price did not last much longer, and the sinking was sudden, instead of gradual. We are not sure if the acquired corporation would lead to anything better for this company. Indie Growers Union has its address in a rather secluded residential area in Las Vegas, and the state of incorporation was Nevada. The company claims to hold $400K in capital, with 400 million shares at par value. A Mr. Robert Coleridge fulfills the roles of president, treasurer, secretary and even board director.

Now, VKML has applied for a name change to Indie Growers Association Inc., and the switch is supposed to take place before the end of the month. This at least gives fuel for some publicity, if it won’t do anything material in the short term.

As for Indie Growers, they are offering almost anything in the model of a pick-and-shovel company. While other OTC stocks are usually happy with one or two activities, Indie Growers plans to unroll services from consulting to greenhouse construction, and even armed security.

But let’s see how a plain greenhouse company is doing- the industry staple, Terra Tech Corp. (OTCBB:TRTC). This ticker peaked at $1.40, but since then slid down, and currently hovers around $0.88. Now, the selection is subdued until further news for the sector, but the enthusiasm of the new legislation in 2014 wears out as the months go by.

A long-term contestant, Growlife, Inc. (OTCBB:PHOT) is slowly expanding, already at $0.50. PHOT was the classic pick-and-shovel business, selling hydroponics systems and lights. Of course, the hydroponics market is already quite occupied with providers, but when it comes to boosting the position of a stock, it is a promising niche.

If you like VKML for its new bargain price, keep in mind that the company shows quite a few drawbacks, and be prepared to absorb large and fast shocks like the one this Wednesday.

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