Last month, Elsight was selected as one of just 10 companies to participate in the second phase of Israel’s National Drone Initiative, nabbing a grant of up to US$450,000 ($665,210), and it’s almost time for the program to commence.

The ultimate goal of the initiative is to reduce road congestion in Israel by developing a continuous operating model that will enable low-altitude passenger-carrying flights throughout the country.

Demonstrations will kick off in January 2023, consisting of one week of flights across the country per month for two years, with limited flight tests in areas without human presence before building up to sparsely populated areas and then eventually demonstrating services within urban areas.

High product maturity the key criteria

Elsight (ASX:ELS) stood out because of its “high product maturity and readiness to participate in our very large demonstrations” Israel National Drone Initiative Technology Leader on behalf of the Israel Innovation Authority, Ofer Lapid, said.

“[The selection criteria also included] adherence to the emerging open standards that govern the unmanned controlled airspace published by The American Society for Testing and Materials (ASTM) standards,” he said.

Elsight will be experimenting with operating large drones intended to carry passengers and heavy cargo in a single-managed airspace.

Opening up urban airspace

With the grant, Elsight will also look to expand its proprietary Halo BVLOS (Beyond Visual Line of Sight) connectivity system.

The plan is to develop additional and next-generational Halo features, including additional Remote ID support, hyper-accurate Global Navigation Satellite System (GNSS), and the next generation of long-term evolution (LTE) and 5G modems for the Halo.

Notably, the Initiative sees a range of vital commercial applications for Elsight’s – and other pilot participants – unmanned aerial systems (UAS).

“UAS has great potential for maintaining commercial delivery applications for the medical sector and for the delivery of commerce,” the Israel Innovation Authority says.

“Hospitals have expensive drugs that must be administered fast and cannot always be stored in the hospital’s storage units.

“This gives the UAS delivery a clear advantage over traditional means of transportation and presents an opportunity for UAS to be a game changer in the medical supply chain of the future.”

DroneUp deal just the beginning

Enabling drones delivery in urban airspace also opens up endless possibilities for delivery of goods and commerce allowing retailers to join UAS companies and provide a fast and secure supply chain.

In fact, the company is already well down this product pathway, securing a contract earlier this year with DroneUp, who were  chosen by US Shopping giant Walmart to enable drone delivery of groceries and other supplies including Covid-19 test kits to US households.

And Elsight recently raised $8 million through an offer of secured convertible notes to a  range of well recognised Australian institutions and sophisticated investors to build on its successful 2022.

The plan is to use the funds for capital expenditure to ensure the company is able to satisfy the unmanned market demands while heading for mainstream commercial adaptation.

This article was developed in collaboration with Elsight Limited, a Stockhead advertiser at the time of publishing.

 This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.