ITM Power’s Bidirectional Future Hinges on a Handful of Investment Verdicts

ITM Power stock flat at €1.34 as £152M order backlog and government grants contrast with pending FIDs and £27-29M EBITDA loss, leaving investors divided.

ITM Power’s share price sits at €1.34, barely changed from the previous session, but the calm is deceptive. Behind the flat line lies a market deeply split between those who see a turnaround taking shape and those who fear the green hydrogen hype has stalled again. The stock has shed 6.25% over the past month and trades a full 48% below the May peak of €2.58 — a reminder that even a 54.8% gain over twelve months offers no shield against abrupt reversals.

At the heart of the standoff is a cluster of final investment decisions that have yet to land. The most immediate is the Cromarty hydrogen project in Scotland, a 15 MW electrolyser capable of producing roughly 7 tonnes of green hydrogen daily for industrial off-takers. Until its FID is confirmed — and alongside it, parallel decisions for German projects under the Stablegrid banner — ITM Power’s bulging order book remains promise, not revenue. The company booked a record £18 million in first-half sales and has pushed its order backlog to £152 million, with the share of profitable contracts rising from 60% in April 2025 to 71% now. Management has lifted its full-year 2026 revenue guidance to a range of £40–43 million. Yet none of that progress translates into hard cash flow until project owners give the green light.

That link between the balance sheet and the project pipeline has been reinforced by a strong state backing. The UK Department for Energy Security has formally approved a £46.5 million grant for the Chronos production line in Sheffield, and Great British Energy committed £40 million in equity in April 2026 — £86.5 million in total to scale the next-generation electrolyser technology. Chronos is meant to lower costs and improve the efficiency of ITM Power’s PEM systems, a critical step if the company is to compete with rivals such as Nel ASA, Plug Power, Siemens Energy and Thyssenkrupp Nucera.

Beyond government money, ITM Power has expanded its commercial footprint. A cooperation with German defence contractor Rheinmetall will supply up to 50 MW of electrolyser capacity for the Giga-PtX programme, which produces synthetic fuels to NATO standards — opening a sales channel outside the traditional green hydrogen market. In Germany, the Stablegrid Group has selected ITM Power as technology partner for two infrastructure projects with a combined capacity of 710 MW. The larger of the two, at 680 MW, is still at a preliminary stage; front-end engineering begins in January 2026, but a final investment decision is not expected until 2028. The smaller Rüstringen project awaits its FID sometime in 2026, with no precise date set.

This long timeline is the flip side of the bull case. Despite rising revenue, ITM Power still expects an EBITDA loss of £27–29 million for the current financial year, even after the upgraded guidance. Roughly 29% of the order book is still tied to older, low-margin contracts that must be worked through over the next 18 months. The ramp-up of the Chronos line is unproven at this scale, and technical risks around customer-specific automation remain. Meanwhile, the German projects — which represent the bulk of the 710 MW pipeline — are years away from any capital deployment. That reality tempers even the most optimistic assessment.

The stock’s trading patterns reflect the tension. The 30-day annualised volatility stands at 105.74%, a figure more typical of crypto assets than an industrial supplier. The relative strength index hovers around 42, neutral on its own but consistent with a market waiting for a catalyst. The share price is roughly 20% below its 50-day moving average, yet still about 24% above the 200-day average — a pattern that shows short-term nervousness without breaking the longer-term uptrend.

For now, ITM Power’s valuation of roughly €911 million rests on the conviction that Cromarty and the first German FID will materialise as expected, and that Chronos will deliver on its cost promises. If those decisions slip further or fail to arrive, the bear case — sustained losses, unproven manufacturing scale and a hydrogen market still struggling to mature — would dominate. The range between the 52-week low of €0.65 and the high of €2.58 leaves ample room for a significant move in either direction. The next few catalysts, not quarterly earnings, will decide which side of that range the stock ultimately settles on.