A notable trend on the capital market in the period 2016-2019 was that of small Israeli companies flocking to the Australian Securities Exchange. A double-digit number of technology companies merged with stock market shells or were floated on the exchange, mostly at modest valuations.
At that time the Australian market was easy to enter, and the Australian Securities Exchange courted Israeli companies, mainly technology companies, that were at early stages or too small for a flotation on Wall Street. A decade later, most of these companies are stagnant, or have been sold or delisted.
There are however successes as well, and one of them is Elsight (ASX: ELS), currently traded at an all-time high, with a market cap of A$989 million (NIS 2.13 billion), after a rise in its share price of more than 1,000% in the past year.
So what does Elsight do and what made its share price explode?
The company was founded in 2009 by Nir Gabay and Roee Kashi (CTO), and in the past few years has been led by Yoav Amitai. It was floated on the Australian Securities Exchange in 2017 at a valuation of just A$20 million. Its business at the time was real time data transmission. Five years ago, however, it decided to focus on communications for unmanned platforms, such drones and robots, for both civilian and military applications.
The product that Elsight developed, Halo, solves the problem of communication with such platforms by means of several communications channels, such as cellular, RF, and satellite, and thus there is no disruption of communications even if one of the channels is unavailable. That has considerable significance in the defense and homeland security markets, but there are interesting applications in the civilian sector as well - for example, the solution was incorporated into the delivery drones of US retailing giant Walmart.
"Our product is a communications product," company CEO Amitai told "Globes". "There has been huge development in that world, and we were in the right place at the right time with the right product to benefit from it. That finds expression in revenue that has grown from $2 million in 2024 to $24 million in 2025, together with a substantial orders backlog of over $22 million."
For the third quarter of 2025, Or Yehuda-based Elsight, which employs 38 people, most of them in Israel, reported revenue growth of almost 20 times to $8.8 million. "I’m happy to say that sales rose by more than the share price," Amitai says. In the first nine months of last year, the company switched to a positive cash flow for the first time, of $11.5 million.
Amitai thinks that the market gives his company its valuation on the basis of three main things: the growth and performance so far; its ability to depict in a pragmatic way the strategic picture and how the market will look in the future; and of course the fact that a great deal of money is flowing to the areas in which it operates.
Oppenheimer & Co. analyst Omri Efroni says that drones are a very hot topic at present, the main reason being the existence of advanced technology that can replace the human pilot sufficiently smartly for it to be efficient. "In the past it cost too much, and so it wasn’t effective. Today, the computing power and the technology make it possible to operate drones in dangerous areas with 80-90% of the capability of a human pilot," Efroni says.
He lists several companies that are prominent in this field, among them US company Ondas, which has acquired many Israeli companies, and in the layer above drones there are fixed-wing aircraft in which public companies AeroVironment (Nasdaq: AVAV) and Kratos Defense & Security Solutions (Nasdaq: KTOS) are active. "There’s a global trend of procuring weapon systems, both traditional and new, a large wave of investment after years of neglect," says Efroni. Among the new technologies are drones and robotics.
Why did you decide to focus on communications for unmanned platforms?
Amitai: "Elsight dealt in many areas of communications, and it was in television broadcasting, border control, and more. We saw that it wasn’t growing sufficiently fast, and we thought about what to do to enlarge the addressable market. The switch was from a projects company to a product company.
"We looked for a field with three elements: that it would grow, even if it was not growing yet; that we would have a product with value that it had to have; and that it was one in which there was no clear leader that we would have to chase after. With our Israeli hutzpa we thought that we could be that player. The reason that we focused on the product market is that we identified these three elements. We developed a product almost from scratch, and that’s a process that took time and involved many difficult decisions. Happily, it succeeded."
Amitai says that since its change of focus Elsight has been active in many markets, from drone delivery to surveillance of water and gas pipelines, agriculture, health services, and more, and has always been connected to the defense market. "The market has been through a real explosion, both on the civilian and the military side, and we were there a moment before, with very many engine hours on the product, and a great deal of experience. We are therefore now benefitting from the growth," he adds.
Competition, but not direct
A prominent characteristic of the past few years has been substantial growth in defense budgets globally, as a result of the unstable geopolitical environment. In its presentation, Elsight mentions this supportive background, and among other things NATO’s decision to raise the target for defense spending for each country in the alliance from 2% to 5% of GDP.
Another following wind comes from the civilian market. According to the presentation, the commercial drones market will grow from $13.9 billion in 2024 to $65 billion in 2032, representing average annual growth of 20.8%.
It’s difficult to estimate Elsight’s total addressable market. Amitai says that the estimates are between $2.2 billion and $25 billion. He points out that there is a great deal of competition ("a company that tells you that it has no competition either doesn’t know its market or is in a market of no interest to anyone") but says that Elsight has no direct competition.
In other words, there are other companies that provide communications solutions for unmanned platforms, but not with the same approach as that of Elsight, which uses all possible communications channels and makes a very small product, an advantage when it comes to mounting it on an unmanned vehicle. Elsight does not sell directly to governments but rather provides its solution to companies that develop systems. According to its website it works with Elbit Systems, Israel Aerospace Industries, Ondas, and Lockheed Martin, among other companies, and also with the police forces in Israel and Dubai.
"We’re not looking to be acquired, but only to expand the business"
Is being traded in Australia right for you? Are you thinking of a listing in Tel Aviv or perhaps Nasdaq as well?
That’s question that we have been asked more and more in recent months, because our numbers have started to grow. We have such significant opportunities in front of us that at the moment it’s right for us to be concentrating on development of the business, and I believe that in the end the stock will follow performance, no matter on which stock exchange."
Elsight’s stock is currently included in the S&P ASX All Technology Index and in the general ASX index, and has the confidence of investors such as Fidelity and UBS, but no Israeli institutions are among its main shareholders.
In the end, you’re a small company with a solution that is incorporated into existing systems. Why shouldn’t a company like Elbit or Ondas come along and acquire you?
"The chance of that happening is there. Innovation in large companies usually comes through an acquisition, and we’re a company with a strong competitive advantage, so it could happen. But we’re not actively looking at being acquired, only at expanding the business. We have considerably enlarged our sales team, we’re developing further products, and we’ve set up a new business unit that is still operating in stealth mode, in which we have taken our data and our expertise and we’re turning them into a product for a slightly different market. If it succeeds, this business could be bigger than our existing one in a few years’ time."
Published by Globes, Israel business news - en.globes.co.il - on January 25, 2026.
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