Electrovaya’s Lithium-Ion Battery Innovation Spurs Strong Fiscal 2023 Earnings

By Bill McNarland On Jan 4, 2024

TDR Three Takeaways:

Electrovaya is tapping into the booming demand for Li-ion batteries, evidenced by its broad product range and its role in the EV and energy storage markets.
The company’s impressive financial growth and outlook for FY 2024 underscore its strong market position and operational success.
Strategic developments and partnerships highlight Electrovaya’s potential as a noteworthy investment opportunity in the sustainable technology sector.

Electrovaya Inc. (NASDAQ:ELVA)(TSX:ELVA)based in Mississauga, Canada, offers a diverse range of products, including batteries for electric vehicles like forklifts and automated guided vehicles, as well as chargers, power products for trucks and buses, and energy storage solutions.

According to research from McKinsey & Company the global demand for Li-ion batteries is anticipated to increase significantly in the next decade, rising from about 700 GWh in 2022 to an estimated 4.7 TWh by 2030. This increase is primarily due to the growing need for batteries in mobility applications, such as electric vehicles (EVs), which are expected to account for around 4,300 GWh of the total demand by 2030. This significant growth is driven by a confluence of factors. Firstly, there’s a regulatory shift towards sustainability, marked by initiatives like Europe’s “Fit for 55” program, the U.S. Inflation Reduction Act, the EU’s 2035 ban on internal combustion engine (ICE) vehicles, and India’s Faster Adoption and Manufacture of Hybrid and Electric Vehicles Program. Secondly, consumer demand for greener technologies is on the rise, with projections that EVs could comprise up to 90 percent of all passenger car sales in select countries by 2030. Lastly, the automotive industry is also contributing to this shift, with 13 of the top 15 original equipment manufacturers (OEMs) planning to discontinue ICE vehicles and set new emission-reduction targets.

Let’s look at how this translated into financial performance for Electrovaya in FY 2023. Electrovaya’s financial performance was excellent, with revenue jumping to $44.1 million from $16.3 million the previous year and Adjusted EBITDA turning positive at $3.2 million. The company expects continued growth in FY 2024, projecting revenues between $65 and $75 million. Electrovaya has key achievements including launching the Infinity-HV battery systems, appointing Steven Berkenfeld to the board, securing a new supply agreement, forming a partnership with a major Japanese trading house, and progressing with the Jamestown Gigafactory. These initiatives position Electrovaya as a significant force in the eco-friendly technology sector. We plan on researching this more in-depth and potentially providing future research coverage of this company.

After reviewing past performance, we are considering a more detailed analysis and potentially initiating research coverage of this company. At first glance, we have observed that the projected revenue for the next year is expected to increase by over 100%, with earnings per share (EPS) anticipated to rise by more than 50%. While these are merely estimates, they have piqued our interest. We will keep everyone informed as we delve further into the company’s financials and regulatory filings.