ITM Power: Institutional Confidence and a June of Binary Catalysts Put the Hydrogen Rally to the Test
03.06.2026 - 17:53:05 | boerse-global.de
The hydrogen sector has seen few stories as polarising as ITM Power’s blistering run this year. Shares have surged between 173% and 185% in the year to date depending on the exchange, with the stock trading at €2.07 in Frankfurt and around 184.5 pence in London. Yet even as the rally gathers pace, the debate over whether the fundamentals can catch up has grown louder.
Behind the headline numbers lies a company that has begun to win credibility on the industrial stage. REFHYNE?2, a 100?MW PEM electrolyser project for Shell at the Energy and Chemicals Park Rheinland in Germany, took home two awards at the World Hydrogen Summit 2026 in Rotterdam: the Clean Hydrogen Project Award and the Industrial Application Award. Due online in 2027, the plant is designed to produce up to 44,000 kilograms of green hydrogen daily – a demonstration that ITM can deliver at scale.
That operational progress is drawing institutional interest. The BlackRock Smaller Companies Trust recently cited ITM Power as one of the key drivers of its second?quarter performance, underscoring the stock’s place in professional portfolios. Meanwhile, CEO Dennis Schulz and director Simon Bourne bought 92 shares each at 162 pence in mid?May, bringing the insider ownership total to 8.73%. Such moves signal conviction from those closest to the business.
The valuation fault?line
Analysts, however, remain deeply divided. Jefferies has a Buy rating and a 200?pence target; Morgan Stanley, which upgraded to Overweight – the first positive rating on a UK hydrogen stock since 2021 – sets a 170?pence objective. Berenberg is also a Buyer but at just 110 pence, while UBS stays Neutral at 60 pence. The average target has been raised from 95 pence to roughly 119 pence, according to some estimates, yet the current price of 184.5 pence sits well above even the most optimistic forecasts. With a forward price?to?earnings multiple of 170.53 and a weighted average cost of capital of 10.29%, the market is baking in extreme growth expectations.
Should investors sell immediately? Or is it worth buying ITM Power?
The bull case rests on a sharp improvement in margin quality. ITM’s order book now stands at £152 million, with 71% of contracts deemed profitable – up from just 6% a year earlier. The company guided for first?half revenue of £18 million, a record, and full?year sales of £40 million to £43 million, representing roughly 35% growth. The adjusted EBITDA loss narrowed to £11.9 million in the first half from £16.8 million, with the full?year target of a £27?£29 million shortfall. Morgan Stanley expects the business to reach EBITDA break?even in fiscal 2028, a year earlier than previously assumed, but that projection requires around 200 MW of new orders.
Three binary events in June
The next few weeks will test whether the pipeline can deliver. Three decisions loom that could either validate or puncture the rally.
Chronos – the factory of the future
ITM’s new 1?GW production line in Sheffield, dubbed Chronos, is designed to build the next generation of electrolysers. Each unit supplies 2 MW, triple the output of current systems, with 40% lower capital costs and half the space requirement. The British government has already committed a capital grant of £46.5 million spread across fiscal 2026/27 and 2027/28, but the final investment decision on the manufacturing line itself has yet to be taken. Production is slated for 2028.
HAR2 – the British hydrogen auction
The second UK hydrogen allocation round has drawn 87 bids totalling 2.8 GW of capacity, far exceeding the 875 MW on offer. Among the 27 shortlisted projects is Uniper’s Humber H2ub, for which ITM could supply six 20?MW Poseidon modules. A win would not only bolster the order book but also cement the company’s position in the domestic market. A final investment decision by Uniper is expected later in 2026.
Uniper’s Killingholme project
Beyond HAR2, Uniper’s separate Killingholme hydrogen project – for which a FEED contract was signed in June 2025 and planning permission granted in March 2026 – remains a key near?term catalyst. The final investment decision here is also targeted for 2026.
ITM Power at a turning point? This analysis reveals what investors need to know now.
Fresh capital and strategic backing
To shore up its balance sheet ahead of these milestones, ITM completed a private placement of 71.99 million shares at ÂŁ0.5556 each, raising approximately ÂŁ40 million from the Great British Energy Group. The placement dilutes existing holders but provides liquidity as the Chronos line and other projects ramp up.
The company has also deepened ties with Rheinmetall under the “Giga PtX” initiative aimed at supplying hydrogen for NATO?related infrastructure, and signed a 10?year service agreement with MorGen Energy for the 20?MW West Wales Hydrogen project, due to start operations in 2028. Meanwhile, the “Electrolysers for Europe” coalition – whose members include ITM, John Cockerill, Nel Hydrogen, Sunfire, thyssenkrupp nucera and Topsoe – issued a position paper on 27 May calling for stronger “Made in EU” preferences and clearer lead markets in response to the European Commission’s Industrial Accelerator Act of 4 March.
The road ahead
The stock’s annualised 30?day volatility stands at 101.89%, a number that explains why even modest news can trigger outsized moves. With a 185% gain already priced in, the market is demanding proof of execution. ITM Power will report its full?year results on 15 September 2026. By then, the decisions on Chronos, HAR2 and Uniper should have provided far greater clarity. For now, the rally has momentum, institutional backing and a packed calendar – but the gap between the share price and the fundamentals has rarely been wider.
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