ITM Power: 27% Weekly Plunge Masks Underlying Progress on £46.5m Grant and Protium Partnership

ITM Power sheds 26.75% in a week as index-related buying unwinds and a peer downgrade hits hydrogen stocks, despite progress on green hydrogen projects.

A brutal week for ITM Power shareholders ended with the stock crashing to €1.68 on Friday, shedding 14.45% in a single session and dragging the weekly loss to 26.75%. The rout follows a 35% peak-to-trough slide from the 52-week high of €2.58 touched just days earlier, when the company was officially admitted to the MSCI United Kingdom Small Cap Index on 29 May 2026.

Two distinct forces conspired to knock the hydrogen specialist off its perch. The first was a textbook “sell the fact” unwind. Arbitrageurs and hedge funds had piled into the stock from mid-May onward, betting on mandatory buying from passive index trackers. Once the index reconstitution was complete, those same players liquidated into the ETF-driven demand, leaving a wall of supply with no natural buyer. The stock gave back all of its index-related gains and more.

The second blow came from the broader waterstoff sector. On 4 and 5 June, analysts at Panmure Liberum slashed their rating on peer Ceres Power from Buy to Sell, citing a widening gulf between technological promise and commercial execution. The downgrade ricocheted across the sector, reigniting doubts about the scalability of PEM and solid oxide technologies. ITM Power, already vulnerable after its speculative run-up, absorbed the heaviest damage.

Operational bright spots buried in the sell-off

Tucked inside the week's carnage were two genuinely positive developments. On 3 June, ITM Power announced a strategic partnership with Protium Green Solutions to develop industrial-scale green hydrogen plants across the UK. The first project, a 15-MW facility called “Cromarty Hydrogen” in the Scottish Highlands, has a final investment decision pencilled for December 2026.

Meanwhile, the UK's Competition and Markets Authority is reviewing a £46.5 million government grant from the Department for Energy Security to support a new automated manufacturing line with 1 GW of capacity. That line will produce the company’s next-generation “Chronos” electrolyser stack, which promises three times the power density of its predecessor and a 40% reduction in unit production costs. The grant would complement the £40 million already committed by Great British Energy, which holds a 10.4% stake in ITM Power.

The CMA’s decision, expected in the coming week, is widely seen as a near-term trigger for the stock — sharply positive if approved, negative if delayed or rejected.

Technical levels and the 200-day anchor

On the charts, the 50-day moving average at €1.56 offers the next support, roughly 7% below Friday’s close. The 14-day RSI at 42.3 is approaching oversold territory but has not yet hit extremes. Some traders point to the 200-day average near €0.99 as a more distant safety net, though the stock would have to fall another 41% to reach it. For context, the year-to-date gain still stands at roughly 130–131%, reflecting the huge rally before the index inclusion.

ITM Power remains a high-volatility name, with annualised swings exceeding 100%. That characteristic amplified both the run-up and the subsequent correction.

Balance sheet strength underpins the long view

Analysts at Morgan Stanley and Jefferies project ITM Power will reach EBITDA break-even in fiscal 2028, provided it secures roughly 200 MW of new orders annually. The company’s balance sheet supports that timeline: nearly £200 million in cash and zero debt. That financial cushion, combined with the prospect of the £46.5m grant and the Protium pipeline, offers a counter-narrative to the week's chaos.

The market’s immediate focus, however, remains on the CMA ruling. Whether that decision reignites the stock’s recovery or deepens the slide depends on the regulator’s verdict — and on whether the operational milestones can eventually outshine the index hangover.