ITM Power at a Crossroads: Grant Decision Looms as Insiders Diverge and Orders Surge

UK subsidy decision on May 26 will determine ITM Power's £46.5M Chronos grant, enabling automated electrolyser production. Insiders diverge, institutions bullish, but profitability remains distant.

The hydrogen specialist’s next big move hinges on a single government verdict due May 26. That day, the UK subsidy authority will rule on a £46.5 million grant for the Chronos production line at ITM Power’s Sheffield plant — a project designed to automate electrolyser manufacturing and triple output capacity to one gigawatt a year. A green light would allow management to take a final investment decision in June, unlocking a path away from the loss-making contracts that have dogged the company. A rejection, however, could trigger exactly the kind of deep share-price slide that analysts have flagged.

While the grant clock ticks, the behaviour of ITM’s own leadership sends mixed signals. Technology chief Simon Bourne recently exercised options on roughly 1.3 million shares, then sold the bulk at an average of 157.44 pence. The company frames the move as a routine disposal to meet tax liabilities, and Bourne still holds nearly 656,000 shares. Chief executive Dennis Schulz has taken the opposite tack: his 1.3 million shares are tied directly to the successful delivery of Chronos and the signing of profitable contracts. That compensation structure aligns his interests squarely with the grant outcome.

Retail investors have been heading for the exits throughout the 12-month rally that has pushed the stock up around 400 percent. On platforms such as AJ Bell, ITM Power has ranked among the most-sold names, with a single day’s trading volume hitting 13.2 million shares. The selling pressure briefly drove the price down to roughly 143 pence. Institutions, meanwhile, have been buying. Morgan Stanley upgraded the stock to Overweight with a 170-pence target, while Jefferies went further, raising its price objective to 200 pence. Both point to improving operations and a more supportive policy environment. UBS takes a more cautious view, rating the shares Neutral with a fair-value estimate of just 60 pence, arguing that the valuation has run ahead of fundamentals.

The operational turnaround is visible in the numbers. First-half revenue for fiscal 2026 hit a record £18 million, and management now expects full-year sales of more than £40 million, with an upper target of £43 million. The order book stands at £152 million, of which 71 percent of contracts are considered profitable — a sharp departure from the legacy portfolio. Despite that progress, profitability remains distant. The pretax loss widened to £45.4 million in the most recent fiscal year. A cash pile of nearly £200 million and zero debt give the company ample runway; analysts see no need for fresh capital before the end of the decade.

Beyond the grant decision, other catalysts are lining up. Uniper’s planned 120-megawatt Humber project, for which ITM has already secured the design contract, awaits a final investment decision. The market also expects the results of the second UK hydrogen allocation round in the coming weeks. And a newly announced tie-up with Rheinmetall — a defence contractor — aims to build a European network for synthetic fuels to supply NATO forces, adding a strategic dimension to ITM’s business development.

The May 26 ruling will therefore test whether the 400 percent rally rests on fundamental progress or hope. A positive verdict lets ITM power ahead with Chronos and turn a corner on margins. A no leaves small shareholders exposed to the downside that even the bulls acknowledge exists.