In 1996, a small battery company opened its doors outside Toronto. Electric forklifts were a niche product then, and most investors had never heard the name Electrovaya (TSX: ELVA).
For almost 30 years, the company kept building, filing patents, working with NASA, and figuring out how to make lithium-ion batteries that could survive brutal warehouse shifts without overheating.
Then, this summer, one of the most demanding customers on the planet made a move that changed the investment thesis.
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Why this TSX stock spent decades flying under the radar
Inside every battery is a thin layer called a separator, which keeps the positive and negative sides apart. Electrovaya makes its separator with ceramic, which handles heat far better than standard plastic. The result is a safer battery that lasts longer.
On the company’s fiscal third-quarter earnings call on Aug. 11, CEO Raj DasGupta said the technology has been proven across more than 35,000 battery systems in tough industrial settings.
In the first nine months of fiscal 2026 (ended in June), Electrovaya reported revenue of US$51.3 million, an increase of 15% year over year. Gross margins rose more than 400 basis points to 34.9%.
So, for every $100 of batteries sold, Electrovaya now keeps about $35 after production costs. A year ago, it kept about $31. The company has also posted six straight quarters of net profit.
Amazon’s bet puts Electrovaya among top Canadian stocks to watch
On July 14, Electrovaya announced a commercial agreement with Amazon (NASDAQ: AMZN). Notably, Amazon was already its largest end customer in fiscal 2025.
According to a company statement, Amazon received warrants to buy up to 13.9 million ELVA shares. These shares will vest only if Amazon makes US$280 million in cumulative purchases. In plain terms, Amazon gets a slice of ownership only if it keeps buying batteries.
DasGupta didn’t pretend the quarter was perfect, though.
“Third quarter revenue was not what we wanted, and we are not going to dress that up. But what moved on us was timing, not lost business, and that revenue remains committed,” he said on the call.
The AI power problem that could lift one of the top TSX stocks
AI data centres have a power problem, given they draw electricity in sudden, massive surges. The International Energy Agency projects that data centre power demand will more than double by 2030.
Most battery storage products release energy slowly over two to four hours. That’s where the new ElvaPulse 1500 comes in. It can release its full charge in under 30 minutes.
DasGupta said Electrovaya is already talking with hyperscalers and data centre developers. He added that a single data centre could account for the company’s total production capacity.
Deliveries are targeted for the second quarter of calendar 2027 from its 137,000-square-foot factory in Jamestown, New York. The company says that site could push annual production capacity toward US$150 million to US$200 million. Compare that with this year’s revenue outlook of US$70 million to US$73 million, and you can see the size of the opportunity.
Electrovaya explained that about US$5 million in high-voltage battery deliveries slipped into fiscal 2027 because of supply chain issues. Customer concentration is another concern, given that two customers accounted for 88% of sales in Q3.
It ended Q3 with total debt of US$38.3 million against US$13.1 million in unrestricted cash.
How a small stake could fit a million-dollar plan
Electrovaya is projected to increase revenue from US$63.8 million in fiscal 2025 to US$321 million in fiscal 2030. The battery maker is forecast to report a free cash outflow of roughly US$5 million in fiscal 2026. However, FCF is estimated to surpass US$100 million in 2030.
If the TSX stock is priced at 20 times forward earnings, it could return more than 500% within the next three years. Here’s the math. A $10,000 investment that grows 20% a year becomes roughly $954,000 after 25 years.
We can see that finding a few fast-growing businesses early can matter so much. Electrovaya could be one of those businesses. It has proven technology, a customer with deep pockets, and a product aimed at one of the fastest-growing markets in the world.
