Connecticut's legal recreational cannabis market has officially rolled out. Seven out of the nine existing medical marijuana dispensaries that were approved to convert to hybrid licenses began sales on Tuesday, and pulled in $251,276 in weed sales by 5. p.m., reported the Hartford Courant.

Which Companies Will Benefit The Most?

The independent stores selling both medical and recreational marijuana are in New Haven, Newington, Stamford and Willimantic - Affinity Health and Wellness (1) and Fine Fettle (3). Multi-state operators (MSO) including Acreage Holdings, Inc. (CSE:ACRG, ACRG.B.U)) (OTCQX:ACRDF), Green Thumb Industries Inc. (OTCQX:GTBIF) (CSE:GTII) and Verano Holdings Corp. (CSE:VRNO) (OTCQX:VRNOF) each opened one store in Montville (The Botanist), Branford (Rise) and Meriden (Zen Leaf).

Two additional shops in Torrington (Still River Wellness) and Danbury (Acreage's Botanist) were approved to open but weren't yet ready, reported CT Insider.

Cantor Fitzgerald analyst Pablo Zuanic said in his latest note that he expects all 18 medical dispensaries in Connecticut will be selling recreational marijuana in the coming weeks and months.

In addition to the nine dispensaries that have "successfully completed the necessary steps for conversion to a hybrid license," in keeping with the Department of Consumer Protection's announcement last year, the nine remaining stores pending green light include one from each Acreage, Green Thumb, Verano, and Trulieve Cannabis Corp. (CSE:TRUL) (OTCQX:TCNNF), four from Curaleaf Holdings, Inc. (OTCQX:CURLF) (CSE:CURA) and one independent - Southern CT Wellness.

And those are just hybrid licenses. Zuanic pointed out that Connecticut's cannabis regulator approved 27 other provisional retail licenses and that 183 cannabis retailer licenses and 105 hybrid retailer licenses are already under review.

"In the past, the CT cannabis regulator had said it would aim for a target of 100 stores by the end of 2023, and more after that," Zuanic said.

On the medical cannabis supply side, Curaleaf, Green Thumb (Advanced Grow Labs), Theraplant - acquired by Greenrose Holding Company Inc. (OTC:GNRS) - and Verano are the four cultivators licensed to operate in the state. 15 new cultivation licenses were issued by the regulator but are not yet operational.

CT Retailers To Supply New Yorkers With Legal Weed

With only one store selling recreational cannabis in neighboring New York, at least for now, Connecticut retailers selling marijuana are expected to benefit, Zuanic said.

"We would expect the western part of CT to benefit from NY traffic initially," he continued. "The ramp-up in stores and production will drive CT sales."

New Market To Hit $300M By Year-End

Taking into account New Jersey's sales data following its recreational sales launch, Connecticut could easily follow suit and hit $300 million by the year ahead, Zuanic projected.

"If we take the NJ per cap for rec/med of $76 six months after launch (we believe CT, like NJ, initially will be slow with store openings and production, although that will change over time), then by year-end CT could be a $250-300Mn market," Zuanic said.

Photo: Courtesy of Nicholas Cappello on Unsplash