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1. Company Snapshot

1.a. Company Description

ITM Power Plc designs, manufactures, and sells hydrogen energy systems for energy storage, transportation, and industrial sectors in the United Kingdom, Germany, rest of Europe, and the United States.It offers HGas for power-to-gas, clean fuel, and industrial hydrogen applications.The company is also involved in the development and manufacture of prototype products; and sale of electrolysis equipment and hydrogen storage solutions.


ITM Power Plc was founded in 2001 and is headquartered in Sheffield, the United Kingdom.

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1.b. Last Insights on ITM

ITM Power Plc's recent performance has been driven by its resilience in a challenging market environment. The company's ability to withstand the broader market downturn, as evidenced by the decline of the FTSE 100 and FTSE 250 indices, highlights its strong financials and growth potential. Additionally, the company's inclusion in recent articles highlighting UK penny stocks to watch suggests its increasing visibility and attractiveness to investors.

1.c. Company Highlights

2. ITM Power's Strong FY2025 Results: A Leap Towards Green Hydrogen Dominance

ITM Power Plc reported a 50% year-on-year increase in revenue to GBP26 million for the fiscal year ending April 2025, driven by a surge in equipment sales and service income. The company's actual EPS came out at '-0.0277', in line with estimates. The contract backlog more than doubled to GBP145.1 million, underscoring the company's successful strategy in securing profitable contracts. A strong cash position of GBP207 million provides ITM Power with the financial muscle to pursue its strategic initiatives.

Publication Date: Aug -31

📋 Highlights
  • Revenue Surge: GBP 26 million, 50% YoY growth driven by equipment sales and service income.
  • Contract Backlog: Doubled to GBP 145.1 million, signaling robust future revenue potential.
  • Operational Excellence: 99% Factory Acceptance Test pass rate, underscoring product reliability.
  • Strong Cash Position: GBP 207 million in cash, reflecting financial stability and liquidity.
  • Profitability Focus: 60% of GBP 145.1 million backlog expected to enhance margins significantly.

Operational Excellence and Strategic Initiatives

The company achieved a Factory Acceptance Test pass rate of 99%, highlighting its improved product quality and reliability. ITM Power is focusing on several strategic initiatives, including the Hydropulse business model, which offers build, own, and operate green hydrogen production plants, and the development of CHRONOS, a next-generation stack platform expected to deliver cost reductions and performance improvements. The company's focus on operational excellence and strategic expansion is expected to further strengthen its competitive advantage in the green hydrogen market.

Cash Flow and Capital Expenditure

ITM Power achieved a significant improvement in its cash position, with a GBP23.3 million cash increase in the year, excluding a GBP13.1 million exceptional item from a commercial settlement. The company successfully reduced inventory while maintaining a healthy balance of raw materials to finished goods. Capital expenditure decreased, with a focus on research and development, particularly on CHRONOS.

Outlook and Valuation

For the year ending April 30, 2026, ITM Power forecasts revenue growth of 50% to between GBP35 million and GBP40 million, driven by the Lingen I project. Adjusted EBITDA loss is projected to improve to GBP27 million to GBP29 million. With a current P/S Ratio of 17.7 and EV/EBITDA of -5.38, the market is pricing in significant growth expectations. Analysts estimate next year's revenue growth at 63.7%, indicating a potential upside.

Path to Profitability

ITM Power is expected to achieve profitability through continued cost discipline, growing the order backlog, and the development of CHRONOS. The company's current gross losses primarily stem from under-absorption at the factory due to the shift from building to capacity to building to order. As order volumes increase, these under-absorptions will decrease, and legacy projects will start contributing to gross margin.

3. NewsRoom

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Stablegrid selects ITM Power for energy infrastructure projects

Nov -28

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UK Penny Stocks Spotlight: ITM Power And 2 Promising Picks

Nov -26

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Germany’s Stablegrid selects ITM Power for 710MW energy projects

Nov -21

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UK Penny Stocks: ITM Power And 2 Other Companies To Watch

Oct -22

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RWE signs capacity reservation agreement with ITM Power

Sep -23

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Discovering Opportunities: 3 UK Penny Stocks Under £4B Market Cap

Sep -16

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[Latest] Global Green Gas Market Size/Share Worth USD 2.81 Billion by 2034 at a 6.20% CAGR: Custom Market Insights (Analysis, Outlook, Leaders, Report, Trends, Forecast, Segmentation, Growth Rate, Value, SWOT Analysis)

Aug -19

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ITM Power Full Year 2025 Earnings: Revenues Beat Expectations, EPS Lags

Aug -17

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (17.72%)

6. Segments

Transport

Expected Growth: 24.07%

ITM Power Plc's 24.07% growth in Transport is driven by increasing adoption of hydrogen fuel cell technology in the transportation sector, government incentives for clean energy, and rising demand for zero-emission vehicles. Additionally, partnerships with major automotive companies and investments in infrastructure development are contributing to the segment's rapid expansion.

Industry

Expected Growth: 11.37%

ITM Power Plc's 11.37% growth in the industry is driven by increasing demand for green hydrogen, government incentives for clean energy, and rising adoption of fuel cell technology in transportation and industrial applications, as well as the company's strategic partnerships and expanding product offerings.

Other

Expected Growth: 11.37%

ITM Power Plc's 11.37% growth is driven by increasing demand for green hydrogen, government incentives for clean energy, and strategic partnerships. The company's electrolyser technology is scalable, efficient, and cost-effective, making it an attractive solution for industries transitioning to renewable energy. Additionally, ITM Power's expanding product portfolio and growing order book contribute to its rapid growth.

Power

Expected Growth: 13.93%

ITM Power Plc's 13.93% growth is driven by increasing demand for green hydrogen, expansion into new markets, and strategic partnerships. The company's innovative electrolyser technology and scalable manufacturing capabilities position it for continued growth in the clean energy sector.

7. Detailed Products

Hydrogen Electrolysis Systems

ITM Power's hydrogen electrolysis systems are designed to convert renewable energy into hydrogen gas, which can be used as a clean energy carrier for transportation, power generation, and industrial applications.

Hydrogen Refuelling Stations

ITM Power's hydrogen refuelling stations provide a safe and efficient way to dispense hydrogen fuel to vehicles, enabling the widespread adoption of fuel cell electric vehicles.

Power-to-X (P2X) Systems

ITM Power's P2X systems convert excess renewable energy into hydrogen, methane, or other energy carriers, enabling the efficient storage and transportation of renewable energy.

Electrolyser Systems for Industrial Applications

ITM Power's electrolyser systems are designed for industrial applications such as chemical synthesis, power generation, and oil refining, providing a clean and efficient source of hydrogen.

Energy Storage Systems

ITM Power's energy storage systems integrate hydrogen electrolysis with energy storage technologies, enabling the efficient storage of renewable energy for grid-scale applications.

8. ITM Power Plc's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for ITM Power Plc is medium, as there are alternative energy storage solutions available in the market, but the company's focus on hydrogen fuel cells provides a unique value proposition.

Bargaining Power Of Customers

The bargaining power of customers is low, as ITM Power Plc's products are highly specialized and customers have limited alternatives, giving the company a strong negotiating position.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium, as ITM Power Plc relies on a few key suppliers for critical components, but the company's strong relationships and long-term contracts mitigate the risk of supplier power.

Threat Of New Entrants

The threat of new entrants is high, as the hydrogen fuel cell market is growing rapidly and attracting new entrants, increasing competition for ITM Power Plc.

Intensity Of Rivalry

The intensity of rivalry is high, as ITM Power Plc operates in a highly competitive market with several established players, and the company must continually innovate and improve its products to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 2.57%
Debt Cost 6.93%
Equity Weight 97.43%
Equity Cost 12.84%
WACC 12.69%
Leverage 2.64%

11. Quality Control: ITM Power Plc passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
ITM Power

A-Score: 4.0/10

Value: 6.8

Growth: 5.8

Quality: 2.7

Yield: 0.0

Momentum: 8.5

Volatility: 0.0

1-Year Total Return ->

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Stock-Card
Koenig & Bauer

A-Score: 3.7/10

Value: 6.2

Growth: 2.7

Quality: 1.4

Yield: 0.0

Momentum: 9.5

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Waga Energy

A-Score: 3.7/10

Value: 6.4

Growth: 3.6

Quality: 3.2

Yield: 0.0

Momentum: 8.0

Volatility: 1.0

1-Year Total Return ->

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Stock-Card
LPKF Laser & Electronics

A-Score: 3.0/10

Value: 6.4

Growth: 2.7

Quality: 3.3

Yield: 0.0

Momentum: 1.5

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Nel

A-Score: 2.9/10

Value: 8.0

Growth: 5.6

Quality: 3.1

Yield: 0.0

Momentum: 0.5

Volatility: 0.3

1-Year Total Return ->

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Stock-Card
Kornit Digital

A-Score: 2.6/10

Value: 6.7

Growth: 3.2

Quality: 3.9

Yield: 0.0

Momentum: 1.0

Volatility: 0.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

0.69$

Current Price

0.69$

Potential

-0.00%

Expected Cash-Flows