Index Inclusion and a Wall Street 'Sell' Combine to Knock ITM Power 27% Lower

Hydrogen specialist ITM Power crashes 27% in a week as index rebalancing selling and a bearish Goldman Sachs note compound profit-taking, despite government funding and a raised revenue forecast.

The past week has been brutal for ITM Power. On Friday alone, the hydrogen specialist crashed 14.45 percent, closing at €1.68 in German trading. The damage over the full five sessions totals nearly 27 percent, wiping out a sizeable chunk of the year’s gains. Two distinct forces converged: the mechanics of an index rebalancing and a pointed warning from Goldman Sachs.

ITM Power joined the MSCI UK Small Cap Index at the start of June. Passive funds were forced to buy an estimated $25 million to $30 million of stock. Active traders and arbitrageurs, having piled in ahead of the event, used that guaranteed demand to offload their positions. The resulting selling pressure turned into a rout as volumes surged. The stock had more than doubled since January — by late May it hit a 2025 high of €2.58 — so profit-taking was always a risk, but the index-linked exit amplified the move.

Goldman Sachs added fuel. The bank reiterated its “sell” rating and nudged its target upward only modestly, from 55 pence to 63 pence. That is far below the current market price. Goldman effectively argued that the equity remains overvalued relative to the company’s path to profitability. The message landed hard in a sector already under strain: Ballard Power dropped roughly 19 percent on the same Friday, Plug Power lost about 12 percent, and Clean Power Hydrogen (CPH2) suspended trading after reporting irreparable damage to a pilot electrolyser unit.

None of this means ITM Power lacks positive developments. The company formalised a partnership with Protium Green Solutions for the Cromarty green hydrogen project in Scotland, a 15-megawatt installation that will use ITM electrolysers to produce seven tonnes of hydrogen daily. The final investment decision is not scheduled until December 2026, meaning no near-term revenue from the site. Government support has been substantial: Great British Energy is injecting £40 million for a stake of just over 10 percent, while the UK energy ministry has pledged a further £46.5 million in grants. That £86.5 million total is earmarked for the development of ITM’s “Chronos” electrolyser platform, which the company says will be 10 percent more efficient and cheaper to manufacture.

The operational story is taking shape. ITM raised its fiscal 2026 revenue forecast to £40 million-£43 million. It ended the recent quarter with roughly $198 million in cash. Yet net losses persist as the company scales up production at its Sheffield factory. The market, for now, is fixated on the gap between ambition and tangible earnings, and the stock has paid the price.

Berenberg responded to the announcements by raising its target to the equivalent of €1.30, still below the current price even after the crash. Technically, the 50-day moving average at €1.56 is the first line of defence. If that gives way, the 100-day average at €1.15 could be the next stop — a level where the shares consolidated before the spring rally. The relative strength index has fallen to 42.8, confirming that buying momentum has cooled sharply.

The Cromarty decision is 18 months away. The Chronos platform will take time to commercialise. Until then, ITM Power remains a high-volatility bet on a future that has yet to deliver, caught between state backing and Wall Street’s scepticism.