An Update on Recent Events with Dr. Raj DasGupta



KEY POINTS
  • Electrovaya aims to complete the uplisting of its stock on the NASDAQ in early 2023. In the latest capital raising, this was one of the attractions examined by both current institutional investors and prospective investors.
  • In preparation for the uplisting, the company is trying to shore up the balance sheet by amending the debt terms in its favor and fully repaying the promissory note account.
  • Electrovaya’s first US plant will create its own high-performance lithium-ion cells and batteries. The new plant, located in Jamestown, New York, will enable the firm to vertically integrate essential components and increase gross margins (up to 10%) in the battery manufacturing sector, strengthening the supply chain.
  • The Jamestown factory is expected to begin cell production in early 2024, with the project’s financing likely to be finalized by January 2023.
  • Demand in the industry is robust and people have adapted to price increases. After severe volatility over the last couple of years, inflationary pricing on battery system components is beginning to normalize. The price of lithium carbonate was escalating quickly and it is still high and costly, but the pace of increase has slowed.
  • Electrovaya has a few goals for 2023: (1) to continue its deployments and growth in the material handling sector; (2) a positive bottom line; (3) to complete the NASDAQ listing; and (4) to establish more relationships with OEMs and other key players.
  • Electrovaya’s separator and electrolyte technologies are its secret ingredient; the rest of the cell is straightforward. Its batteries are based on a membrane made entirely of ceramic. It contains 90% ceramic by weight. Unlike ordinary polymer lithium-ion separators, this material is resilient at high temperatures. It delivers prolonged cycle life owing to its high density when paired with a novel electrolyte and cell design.
  • Our prior content on EFL can be accessed here. The fireside chat from November 3, 2022, can be accessed on demand.
OUR INSIGHTS

The Opportunities

Electrovaya is uniquely positioned to leverage the rapid growth in lithium-ion battery demand. Its strategic relationships with major OEMs, including Raymond and Toyota, demonstrate the company’s progress and technology. In addition, Electrovaya batteries have started being used by major material handling customers, including Walmart, Mars, Home Depot, and a large online retailer. There is also a robust opportunity to retrofit existing lithium-ion units from lead-acid batteries. The company believes there are additional opportunities in buses and Class 3 trucks and recently inked a supply agreement with Vicinity Motors. Solid-state batteries represent the second growth stage and are a sea change technology under development, with 2023 targeted for launch.

The Obstacles

The company has successfully pivoted from e-passenger cars to material handling and commercial vehicles. However, execution risk is minimized as a few thousand Infinity batteries for e-forklifts have been recently delivered to sophisticated Fortune 100 customers. The performance and commercial viability of the company’s SSB platform is still unknown.

Electrovaya aims to complete the uplisting of its stock on the NASDAQ in early 2023. In the latest capital raising, this was one of the attractions examined by both current institutional investors and prospective investors.

EXECUTIVE DISCUSSION

Executive in Focus: Dr. Raj DasGupta has been with Electrovaya since 2009 and serves as COO.

Shawn Severson: Raj, you've been busy; lots to talk about. I guess we will start with the most recent event, which is the capital raise. And obviously, I'd certainly like to hear your views on that and review its reasoning. What do you think it does for you, and where can it take you over the next six months?

Raj DasGupta: It is a big piece of news. Overall, we're very excited to have support from those investors, including the lead investor and the others, as they are bullish on the prospects for Electrovaya. Many of these we're already existing institutional investors for the most part. Through this process, they are very excited to see Electrovaya continue to grow. The NASDAQ uplisting angle of it is key to these folks and us as a company and part of this.

This is pre-NASDAQ, and we intend to complete an uplisti...

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