Nel ASA’s €11 Million EU Grant Can’t Hide a 73% Order Collapse

Nel ASA shares more than double in Frankfurt to €0.33, but all seven analysts rate it a sell. Order intake collapsed 73% YoY, while an EU grant offers only temporary relief.

Nel ASA has seen its shares more than double in Frankfurt this year, closing Friday at €0.33 — a new 52-week high. The 30-day gain stands at over 62%. Yet the rally runs directly against the grain of the company’s fundamentals. None of the seven analysts covering the stock recommend buying it; all seven rate it a sell. Their average price target, converted, sits at roughly €0.19 — implying a 42% decline from current levels.

The most immediate catalyst is a scheduled €11 million tranche from the EU Innovation Fund, expected to land in the second quarter of 2026. That disbursement is part of a larger programme worth up to €135 million, covering as much as 60% of the industrialisation costs for Nel’s pressurised alkaline electrolyser platform. If the cash arrives on time, it could bolster sentiment ahead of the half-year results due on 15 July. But a single grant, however welcome, does not fix the deeper imbalance between the stock price and the operating reality.

New platform, old problem: missing orders

Nel rolled out its next-generation alkaline pressure electrolyser in May, after more than eight years of development and successful full-scale tests at its Herøya facility. The company claims total system costs below $1,450 per kilowatt for a 25-megawatt plant. That is a headline-grabbing figure, but the commercial traction has yet to match the engineering ambition. In the first quarter of 2026, order intake collapsed 73% year-on-year to just 85 million Norwegian kroner. The order backlog shrank 24% to 1.113 billion kroner.

Chief executive Håkon Volldal insists he expects more final investment decisions in 2026 than in 2025 and says he is holding concrete talks with multiple potential customers for projects ranging from 50 to 150 megawatts in Europe and North America. The market wants signed contracts, not pipelines or memoranda of understanding. Until those materialise, the valuation premium against analyst consensus — which stands at 2.14 Norwegian kroner per share on the Oslo exchange — remains hard to justify.

Balance sheet risks linger

The financial scars from past over-ambition are still visible. Nel is reviewing the carrying value of two idle production lines at Herøya, originally built for atmospheric electrolysers. The outcome — restart, closure or sale — is undecided, and a further impairment charge is possible. That would add to the 799 million kroner in write-downs already taken in the 2025 financial year.

On the positive side, the company ended the first quarter with 1.4 billion kroner in cash, providing a meaningful buffer. The EU grant adds another €11 million in the short term, and the total Innovation Fund programme could eventually fund up to €135 million of Nel’s industrialisation costs. That gives the company time, but time is not the same as orders.

PEM earns small victories

While the alkaline platform dominates the narrative, Nel’s PEM division has quietly notched a couple of wins. Mesure Process, a European subsidiary of Synqo Energies, placed a repeat order for containerised units that will supply hydrogen to filling stations and industrial customers. Meanwhile, the Douglas County Public Utility District in Washington state has bought a Nel electrolyser — the first time a public utility will operate one of the company’s devices. The system is scheduled to start up in the first half of 2027, using surplus hydropower.

These are positive signals, but they remain modest in scale compared with the gap left by the order book collapse.

Analysts stay cautious

Investment banks are not joining the rally. Berenberg’s James Carmichael cut his price target from 2.60 to 2.30 Norwegian kroner, maintaining a neutral rating, while Citigroup trimmed its target from 2.70 to 2.40 kroner. Both cite ongoing uncertainty over the commercial ramp-up. The broader sector mood is not helping: Thyssenkrupp Nucera lowered its outlook in March 2026 because of rising costs and project delays in the electrolyser segment, underlining that the headwinds are industry-wide, not just Nel-specific.

Nel has already booked a small order worth around 70 million kroner for the second quarter. Whether larger projects in the 50–150 MW range come to signature before the half-year report on 15 July will decide if the stock’s surge gains fundamental support — or whether the gap between price and reality widens further.