The £86.5 Million Catalyst That Has ITM Power’s Bulls Betting on a 2028 Breakthrough

ITM Power shares surge to 174.80 GBX amid institutional upgrades, but retail investors sell heavily. The £86.5M Chronos project hinges on a UK regulatory decision due May 26.

ITM Power’s stock has surged to a 52-week high of 174.80 GBX, but the real story lies beneath the surface — a tale of institutional conviction clashing with retail caution, all tied to a single government decision due in late May.

The Sheffield-based electrolyser manufacturer has become a battleground stock. Jefferies recently upgraded the shares to “Buy” with a 200p price target, up from 115p, while Morgan Stanley assigned an “Overweight” rating with a 170p target. Both banks see the company reaching operating profitability by fiscal 2028 — a full year ahead of consensus expectations.

Yet on trading platforms like AJ Bell, retail investors have been heading for the exits. ITM Power accounted for nearly one in every 50 sell orders recently, with 13.2 million shares changing hands in a single session — a 168% spike above average daily volume. The divergence between professional optimism and private profit-taking is stark.

The £86.5 Million Bet on Chronos

The catalyst driving institutional enthusiasm is the “Chronos” project. In April, ITM Power secured £86.5 million in funding, comprising a £40 million strategic investment from Great British Energy alongside £46.5 million in government grants. The money is earmarked for a new automated gigawatt-scale production line in the UK.

This funding, however, is contingent on a regulatory review. The UK’s subsidy control authority is expected to publish its findings on May 26. If the verdict is positive, management will take a final investment decision in June, unlocking the promised state support for the expansion.

The Numbers That Divide the Street

ITM Power’s balance sheet provides a formidable cushion. The company expects to end its fiscal year in April with over £210 million in cash, giving it more than three years of runway without needing to tap equity markets. Net cash stands at roughly £200 million.

The order book has reached £152 million, with 71% of contracts now considered profitable — a marked improvement from the loss-making legacy projects that plagued the company in previous years. Management has lifted revenue guidance for fiscal 2026 to as much as £43 million, while forecasting an operating loss of no more than £29 million.

But not everyone is convinced. UBS maintains a “Neutral” rating with a 60p fair value estimate, while Berenberg, despite a “Buy” recommendation, has trimmed its target to 110p. Jefferies itself acknowledges the downside risk, pegging potential losses in a negative scenario at 52%.

The Technology That Could Change the Math

At the heart of the bull case is the next-generation Chronos platform. Each electrolyser unit delivers two megawatts of capacity, cuts costs by 40%, and halves the physical footprint compared to current models. The technology is central to the “Giga PtX” partnership with Rheinmetall, which aims to build a decentralized synthetic fuel network across Europe to secure NATO energy supplies.

For now, the market is betting on a positive outcome from the subsidy review. If the green light comes, ITM Power’s path to profitability — and that 200p target — looks considerably more attainable. If not, the 52% downside scenario Jefferies warns about could become the dominant narrative.