Best Green Hydrogen Stocks in India 2025 for Long Term Investment

Have you heard of "green hydrogen stocks"?

Well, some of us might wonder that this is just another green energy source or fad in the green revolution.

The green hydrogen is becoming a game changer in the green revolution of the world, with India being the leading player in the race.

The Indian government is demonstrating its commitment to this initiative through ambitious actions.

The Indian government recently announced a massive auction to buy 200,000 tonnes more green hydrogen-based ammonia than it originally planned on behalf of the fertiliser sector.

It had earlier launched a tender for ten-year contracts in which it planned to purchase 539,000 tonnes a year of green hydrogen-derived ammonia, to be split across eleven projects with delivery points across the country.

This is a significant step towards demand creation of green hydrogen and its derivatives in the country.

Considering the government's strong commitment, we have filtered out some stocks based upon their market capitalization and their proactive approach to capitalizing on the rise of green hydrogen energy, that could power your portfolio through 2025 and beyond.

Let's have a look...

#1 Adani Power

First on the list is Adani Power.

Adani Power is a subsidiary of the Indian conglomerate Adani Enterprises. The company is in the business of power generation, accumulation, distribution, and supply of power.

The company has signed long-term power purchase agreements of about 9,153 MW with the government of Gujarat, Maharashtra, Haryana, Rajasthan, Karnataka, and Punjab.

Coming to its financials, revenue from operations rose by 3% to Rs 133.4 bn for Q2 FY25, up from Rs 130 bn in the same quarter last year. This slight increase reflects stable power demand, but challenges in fuel costs and operational efficiency limited stronger growth.

The company's earnings before interest, tax, depreciation, and amortisation, (EBITDA), rose 24.6% year-on-year (YoY) to Rs 52.8 bn for Q2 FY25.

Despite the EBITDA growth, profitability issues persisted due to higher costs. The EBITDA margin stood at 39.6% compared to 39.8% in the corresponding period in the previous financial year.

This resulted a sharp 50% drop in consolidated net profit to Rs 32.9 bn for Q2 FY25. Compared to Rs 65.9 bn in Q2 FY24. This decline in profit was due to rising operational costs which weighed on overall earnings despite some growth in revenue.

Below is the table showing the annual financial performance of Adani Power.

Adani Power Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	11%	-1%	6%	40%	30%
Operating Profit Margin (%)	22%	33%	36%	26%	36%
Net Profit Margin (%)	NM	5%	18%	28%	41%
Return on Capital Employed (%)	7%	12%	16%	16%	32%
Return on Equity (%)	NM	10%	27%	36%	48%

Data Source: Ace Equity

Going forward, the company plans to expand by adding capacities at its thermal power plants in phases over FY28-30. The company's management has acknowledged potential threats from renewable energy sources and battery storage.

On the green initiatives front, Adani Power is conducting a pilot study on green ammonia blending at the Mundra site, aimed at assessing the technical feasibility and market viability of this solution before implementation.

The company has secured a 25-year agreement to supply 1,500 MW to Bangladesh, benefiting from recent improvements in payment timelines from the Bangladesh government.

Adani Power plans to expand its thermal power capacities in phases over FY28-30, with a pilot study on green ammonia blending at the Mundra site to explore sustainable energy solutions.

However, despite these ambitious plans, recent allegations against Chairman Gautam Adani have caused significant losses in the group's stock, and ongoing legal challenges in the US could hinder project execution.

The possibility of fines or penalties may delay growth initiatives, as the group may need to reallocate resources or divest non-core assets.

To restore its reputation, the company is focusing on stronger communication strategies and ensuring compliance.

Despite these challenges, Adani Power is still well-positioned to capitalize on emerging opportunities in India's power sector.

Backed by a robust pipeline of projects, Adani Power is well-positioned to capitalise on emerging opportunities in India's power sector.

To know more about the company, check out Adani Power's fact sheet and quarterly results.

#2 NTPC

Next on the list is NTPC.

NTPC is a key player in the power sector, producing and distributing large quantities of electricity to various utility providers. It's a leading Indian central public sector undertaking (PSU) in the power generation sector.

Coming to its financials, in the second quarter of FY25, the company saw a decrease of 0.6% YoY in revenue to Rs 447 bn.

While the operating profit for the quarter saw a decrease of 8.1% YoY to Rs 116.5 bn. The operating profit margin also declined to 26% versus 28%, in Q2 FY24.

On the bottom-line front, the company grew its revenue 4.4% YoY to Rs 70.4 bn. The net profit margin for the quarter stood at 12% versus 10.5%, in Q2 FY24.

Below is the table showing annual financial performance of the company.

NTPC Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	9%	2%	19%	33%	1%
Operating Profit Margin (%)	29%	31%	30%	27%	29%
Net Profit Margin (%)	11%	13%	13%	10%	12%
Return on Capital Employed (%)	10%	9%	9%	10%	10%
Return on Equity (%)	10%	12%	13%	12%	13%

Data Source: Ace Equity

Going forward, NTPC plans to capitalise on the government's nuclear goals. India aims to significantly increase its nuclear energy capacity, expanding from 7,480 MWe in 2024 to 22,480 MWe by 2031-32.

This ambitious plan involves building 10 new reactors, adding 8,000 MWe across several states, including Gujarat, Rajasthan, Tamil Nadu, Haryana, Karnataka, and Madhya Pradesh.

Moreover, the company has also announced in one of its press releases that it is establishing a one tonne per day seawater to green hydrogen plant.

This plant will be developed through NETRA, the research and development centre of NTPC. It will be set up at NTPC Simhadri near visakhapatnam in Andhra Pradesh.

For more details, see the NTPC company fact sheet and quarterly results.

#3 GAIL

Third on the list is GAIL (Gas Authority of India Limited).

GAIL is a prominent Indian government-owned company specialising in the natural gas sector. The company is a leader in this segment with around 75% of its revenues coming from natural gas marketing.

Additionally, GAIL is involved in various segments, including petrochemicals, natural gas transmission, LPG (liquefied petroleum gas), among others. The company claims to be one of the top 10 global liquefied natural gas portfolio marketers.

Moreover, the company accounts for 67% of the piped natural gas connections in India.

Coming to its financials, its revenue from operations, in Q2 FY25 saw a mild increase of 3.5% YoY, reaching Rs 329.3 bn in the July-September period.

This rise was bolstered by stronger demand and stable gas transmission volumes, contributing to steady revenue growth despite some challenges.

The operating profit for the quarter stood at Rs 39.4 bn, growing 10% YoY. The operating profit margin grew to 12% versus 11%, in Q2 FY24.

GAIL posted an 11% YoY increase in net profit, reaching Rs 26.7 bn. This growth in profit was primarily driven by a rise in earnings from the gas transmission business.

Additionally, a recovery in the petrochemicals segment offset weaker performance in marketing margins, balancing the company's overall profitability.

Below is the table showing annual financial performance of the company.

GAIL Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	-5%	-21%	62%	57%	-9%
Operating Profit Margin (%)	12%	13%	16%	5%	11%
Net Profit Margin (%)	13%	11%	13%	4%	7%
Return on Capital Employed (%)	20%	13%	23%	10%	15%
Return on Equity (%)	19%	12%	19%	9%	13%

Data Source: Ace Equity

In May 2024, the company announced maiden green hydrogen plant at Vijaipur in Madhya Pradesh, with a capacity of producing 4.3 TPD of hydrogen, through 10MW PEM (Proton Exchange Membrane) electrolyzer units, by electrolysis of water using renewable power.

Looking ahead, the company is working towards establishing itself as a major player in the global LNG market, aiming to increase its trading volumes significantly by 2030.

To support this expansion, GAIL has prioritised infrastructure development, committing Rs 1.9 bn in capital expenditure this quarter and reaching a total of Rs 3.5 bn in the first half of FY25.

This investment is mainly focused on expanding its pipeline network and strengthening petrochemical capabilities. This will enhance gas availability and support growth.

For more details about the company, you can have a look at the GAIL fact sheet and quarterly results on our website.

#4 ONGC

Last on our list we have Oil and Natural Gas Corporation (ONGC).

ONGC is India's largest producer of crude oil and natural gas, accounting for around 70% of the country's domestic production.

Its wholly owned subsidiary, ONGC Videsh, is the largest Indian multinational in the energy space, with operations in 36 oil and gas properties across 17 countries.

The company has a balanced portfolio of mature and new oil fields ensuring continuous growth, while proactively implementing well interventions and advancing new well drilling activities.

Coming to its financials, in Q2 FY25, ONGC saw its highest ever quarterly growth in revenue, in the past seven quarters of 7.3% YoY to Rs 1.6 tn.

The operating profit during the period saw a decline of 27% YoY to Rs 205 bn, while the margin for the quarter fell sharply to 13% versus 19%, in Q2 FY24.

The net profit for the quarter also fell sharply by 39% YoY to Rs 98.7 bn. The net margin for the quarter slumped to 6.2% YoY versus 11%, in Q2 FY24.

Below is the table showing annual financial performance of the company.

ONGC Snapshot (2020-24)

	FY20	FY21	FY22	FY23	FY24
Revenue Growth (%)	-6%	-23%	62%	29%	-6%
Gross Margin (%)	32%	36%	55%	58%	62%
Operating Profit Margin (%)	13%	16%	16%	12%	17%
Net Profit Margin (%)	3%	7%	10%	5%	10%
Return on Capital Employed (%)	10%	9%	16%	14%	18%
Return on Equity (%)	6%	10%	19%	12%	17%

Data Source: Ace Equity

Looking ahead ONGC's future looks bright. The oil giant is pursuing several initiatives to increase production capacity, including the Daman Upside and DSF II projects.

ONGC's diversification across crude, gas, and exploration provides stability, but its true upside lies in its ongoing projects like the KG-98/2 oil and gas field, which is ramping up production.

With peak output expected by FY25-end or early FY26, the project could significantly boost the company's earnings in the medium term.

Additionally, the company plans to invest approximately US$ 10 bn in green hydrogen and ammonia projects by 2035.

Moreover, the shift from APM gas to New Well Gas (NWG) should drive long-term volume growth, further strengthening the company's fundamentals.

To know more about the company, check out its financial factsheet and latest financial results.

Conclusion

Overall, the Indian green hydrogen stocks' potential is promising. But it's important to appreciate that the sector still faces challenges, including high production costs, regulatory obstacles, and the need for significant infrastructure development.

Not every company in this space will succeed, and some may struggle to meet expectations. So, investors should be cautious and avoid getting carried away by the hype surrounding this emerging industry.

Although there are opportunities for growth, it's important to carefully assess the financial health, technology, and long-term prospects of any company before investing.

With the market still developing, investors should stay aware of the risks and evaluate each opportunity carefully.

Happy Investing!

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...