As the world shifts to solutions for sustainable energy, it is in the clean energy landscape that green hydrogen will play an incredibly important part. In India, this approach could prevent 830 million tonnes of CO₂ from entering the atmosphere annually, compared to traditional fossil-fuel-based methods.
India has been at the forefront of targets in renewable energy and holds a very significant marketplace for green hydrogen. Let’s explore some of the best green hydrogen stocks in India that are in store for 2024 with companies that lead the charge in the innovative sector.
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What is green hydrogen?
Green hydrogen is electricity from splitting water through electrolysis, powered solely by renewable sources of energy; either solar or wind energy. This approach avoids carbon emissions, unlike conventional hydrogen production methods that rely on fossil fuels.
This way, many investors see an opportunity in investing in the various green hydrogen stocks that have started to catch the latter due to spiking demand in clean energy options.
Key drivers of green hydrogen investment
- Government-level initiatives: The Indian Government is similarly vocal about the initiatives of the same toward the promotion of consumption of green hydrogen. For example, the government has established India’s National Hydrogen Mission with ₹ 19,744 crore investment. This mission will position the country among the foremost producers of green hydrogen in the entire world.
- Technology upgrade: The technology of electrolysers and hydrogen storage solutions is under upgradation; thus, producing green hydrogen is economically and efficiently feasible.
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Top green hydrogen stocks in India
Below is a selection of prominent green hydrogen companies, highlighted for their visibility and frequent mention in industry sources.
| Company | Sector | Market cap (in Cr) | Key highlights |
| Adani Green Energy Ltd | Renewable energy | ₹2,40,987 | Green hydrogen facility at Mundra, Gujarat, with a target of 1 million tons per year by FY27. The company intends to increase output to 3 million tons over the next decade, with an estimated investment of $50 billion, contingent on market dynamics |
| Reliance Industries Ltd | Diversified (Energy & telecom) | ₹17,22,332 | Aims to transition its Jamnagar refineries from grey to green hydrogen by utilising renewable energy from a 20 GW solar initiative, expected by 2025. |
| Indian Oil Corporation Ltd/ IOCL | Oil & gas | ₹1,96,045 | By 2050, Indian Oil intends to replace half of the hydrogen consumed in its refineries with green hydrogen. |
| Bharat Petroleum Corporation Ltd/ BPCL | Oil & gas | ₹1,34,320 | BPCL will build India’s first green hydrogen facility at Cochin Airport. The company plans a $18.16 billion investment with a net zero goal set for 2040. |
| NTPC Ltd | Power generation | ₹3,68,616 | India’s largest green hydrogen production facility to be established near Vizag. |
| CESC Ltd | Utility | ₹24,353 | Secured a government project for producing 10,500 metric tons of green hydrogen. |
Source: Screener (As of 12.11.2024)
Company insights
- Adani Green Energy Ltd: One of the flag bearers of India’s renewable energy revolution, with a very ambitious plan to invest over $50 billion in green hydrogen projects over the next decade along with TotalEnergies. Its healthy revenue growth and market presence makes it a hotspot destination for investors.
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- Reliance Industries Ltd: This diversified company is known for its participation in all sectors from telecommunication and refining to retailing. Reliance Industries are making huge investments in green hydrogen technologies and infrastructure, which puts it at an advantageous scale and financial depth within this emerging market.
- Indian Oil Corporation Ltd: IOCL is India’s largest oil company, but it’s also on its way to making significant strides into the green hydrogen space-with plans to enhance production capacities significantly over the coming years.
- Bharat Petroleum Corporation Ltd: Tie-up of BPCL with research organisations to take forward the advanced electrolyser technology seems a step to place itself among the first few green hydrogen producers.
- NTPC Ltd: Being the largest power generation company in India, it is rather focusing on renewable energy and green hydrogen projects to maintain this path towards a sustainable journey.
- CESC Ltd: The group diversified into all renewable sources of energy. Recently, it has even won an important project under the National Green Hydrogen Mission.
Challenges facing the sector
Despite the promising outlook for green hydrogen stocks, several challenges persist:
- High initial costs: The production of green hydrogen remains expensive compared to conventional methods.
- Infrastructure development: Significant investment is needed to develop infrastructure for storage and distribution.
- Market competition: As more players enter the market, competition may intensify, affecting profitability.
Conclusion
Green hydrogen stocks are one of the best investment prospects for a sphere that is rapidly changing to go hand in hand with broader global sustainability goals. Companies like Adani Green Energy and Reliance Industries are setting out such activities through investments and innovative ventures. However, research has to be perfect in its consideration of opportunities and risks from all potential investors in this emerging sector.
As India continues its journey towards becoming a leader in renewable energy and sustainability, monitoring these stocks could yield significant returns while contributing positively to environmental goals.
FAQs
1. What is green hydrogen, and how does it differ from traditional hydrogen?
Green hydrogen is produced by splitting water into hydrogen and oxygen using electrolysis powered by renewable energy sources like solar or wind. Unlike traditional hydrogen production methods that rely on fossil fuels and emit CO₂, green hydrogen is carbon-free, making it a more sustainable option. This clean energy form has significant potential in reducing greenhouse gas emissions and advancing global sustainability targets.
2. Why is India investing heavily in green hydrogen?
India is investing in green hydrogen to reduce dependency on fossil fuels, curb carbon emissions, and align with its renewable energy goals. Through initiatives like the National Hydrogen Mission, the government aims to make India a global leader in green hydrogen production. Such investments can also support economic growth, job creation, and energy security, helping India meet its climate commitments and reduce its carbon footprint.
3. Which are the top companies in India focusing on green hydrogen?
Some prominent companies investing in green hydrogen in India include Adani Green Energy, Reliance Industries, Indian Oil Corporation, NTPC Ltd, and Bharat Petroleum. These companies are actively developing hydrogen production, storage, and distribution infrastructure. They aim to lead the renewable energy sector by aligning with national and global sustainability goals, making them strong options for investors interested in clean energy stocks.
4. What are the main challenges for green hydrogen production in India?
Key challenges for green hydrogen production in India include high initial costs, limited infrastructure for production, storage, and distribution, and the need for advanced technology. The cost of electrolysis technology remains high, making green hydrogen more expensive than traditional energy sources. Additionally, substantial investment in infrastructure and research is needed to scale production, improve efficiency, and reduce costs, which companies and government initiatives are gradually addressing.
5. Is investing in green hydrogen stocks a good choice for 2024?
Investing in green hydrogen stocks in 2024 could be promising, given the growing focus on sustainable energy solutions and government support. Companies like Adani Green and Reliance Industries are heavily investing in green hydrogen, which could provide long-term growth. However, investors should consider the challenges, market volatility, and infrastructure costs before investing. For those with a long-term view, green hydrogen stocks may offer good returns as the sector matures.
