Egm x-rayed: Elsa Solutions doubles ebitda with batteries, lithium and hydrogen

And all in all, these are also prudent intentions based on organic growth. But above all on technology, since the company intends to expand the product portfolio of the E-Motion business line to include new components such as Hmi (Human Machine Interface) and Plc (Programmable Logic Controller) displays, both product families for industrial automation. Above all, however, Elsa Solutions intends to devote itself to the development and production of hydrogen gensets (the first was supplied to a Dutch residential complex in 2022), and to take this business to a level equal to the current lithium battery business. And this is where ambition comes in.

In the meantime, the implementation of the 'Second Life Batteries' project, i.e. the recovery and reuse of spent lithium batteries in a circular economy, will also be continued, offering a battery disassembly service. The actual start-up of this activity could take place by 2025 and the remanufactured batteries would be destined for inclusion in renewable energy production plants.

A new milestone has now been reached with the obtaining of Type Approval Certification from Rina (Registro Italiano Navale) for Aliant's Mep series lithium batteries. This certificate also allows the batteries to be installed on vessels longer than 24 metres; however, it should be remembered that well over half of Aliant's business line revenues are related to Ek series batteries, whose applications are mostly aimed at aerial platforms, road sweepers, electric buses, earth-moving machinery, mini-grues and mini-excavators.

At the end of 2023, Elsa Solutions' order backlog amounted to EUR 11.4 million (of which 23% related to the E-Motion business line and as much as 77% to the Aliant business line), which is expected to be converted into revenue by 2024. Based on the performance in the first two months of 2024, management is optimistic for the current financial year as a whole, also due to the acquisition of new strategic customers. The company also promotes its products by participating in the relevant trade fairs for the two business lines (in particular Sps Ipc Drives in Parma for industrial automation products, held in May, while in Cologne at the Ivt International trade fair at the end of June, an innovative lithium battery with extremely fast charging capacity and energy density characteristics 30% higher than previous versions will be presented).

From the outset, the market appreciated the business proposition of Elsa Solutions.The share was placed at EUR 2.5 per share and the current price is around EUR 4. In addition, 4Aim Sicaf (4.25% of the share capital, 3.25% of the voting rights) and Lombard International Assurance Sa (4.21% of the share capital, 3.22% of the voting rights) later joined the capital. The free float is decidedly high for a company on the Euronext Growth Milan, at over 41%.

Now it is time to beat the competition to the punch. At the IPO, the company identified some Italian competitors for both business lines, including two listed companies: the aforementioned Enertronica Santerno (Euronext Growth Milan) for the E-Motion sector and Seri Industrial (Euronext Milan) for the Aliant sector. But both groups are going through difficult times (Enertronica Santerno is suspended from trading, while Seri Industrial recently took over a company in an entirely different sector, Industria Italiana Autobus). As far as hydrogen gensets are concerned, Italy's main competitor at present is the Piacenza-based TecnoGen (part of the Avellino-based Bruno Generators group), which in 2023 sold its H2 genset to John F. Hunt Power, a leading British company in the field of rental, sale and installation of gensets for the construction industry.

However, there is certainly also room for Elsa Solutions, our 'two-faced Janus' (who, not coincidentally, was the Roman deity of beginnings, both material and immaterial), which can also point to numerous factors related to ESG issues: more than half of the raw materials used are renewable or recycled, and more than 50 per cent of the products marketed are recyclable; in addition, the company has had a photovoltaic plant since 2018 from which it derives almost 40 per cent of the energy used (and aims to achieve energy self-sufficiency) and recycles a large part of the waste produced. Finally, it has already carried out the quantification of Greenhouse Gases emissions and initiated a project aimed at achieving the Net-Zero target by 2030. All these meritorious initiatives only lack a sustainability report.