Top 10 Green Hydrogen Stocks to Watch in India

Key Players in India’s Green Hydrogen Sector

With the global push toward sustainability, green hydrogen is rapidly gaining prominence in India. The clean energy source is expected to play a major role in transforming the country’s energy landscape. Investors wanting to leverage the growth potential of this emerging sector must invest in the best hydrogen stocks in India. 

That being said, finding the right companies that are fundamentally strong and have promising growth potential can be challenging. To guide investors toward promising companies, we have curated a comprehensive green hydrogen stocks list along with the key fundamentals of each entity in this industry.   

• Reliance Industries Ltd.

Reliance Industries Ltd. is one of the largest conglomerates in the energy and petrochemicals sector, making it a frontrunner among the best green hydrogen stocks in India. The company is investing heavily in renewable energy initiatives, which include a giga complex exclusively for green hydrogen projects in Jamnagar. 

With a market capitalisation of Rs. 17,52,645.28 crore as of December 09, 2024, Reliance Industries is the largest entity in the green hydrogen stocks list. The company’s EPS of Rs. 50.19, 3-year revenue CAGR of 13%, and a 5-year CAGR return of 10.69% highlight its consistent growth trajectory. 

• Oil & Natural Gas Corporation Ltd.

ONGC, a leading crude oil and gas exploration company, is making huge strides in the green hydrogen sector. With a market capitalisation of Rs. 3,25,577.63 crore as of December 09, 2024, and a low PE ratio of just 8.00, ONGC represents one of the more accessible options in the green hydrogen stocks list. 

The company’s ventures into green hydrogen projects showcase its commitment to business diversification and sustainability. Thanks to a strong EPS of Rs. 32.33 and a high dividend yield of 4.73%, ONGC is one of the best green hydrogen stocks in India for income-seeking investors.

• JSW Energy Ltd.

JSW Energy Ltd. has emerged as a prominent player in the renewable energy landscape. The company is likely to enter the top 10 green hydrogen stocks in India with its largest commercial-scale green hydrogen project in the country.   

JSW Energy’s 5-year CAGR return of 55.06% indicates impressive growth, whereas its PB ratio of 4.22, reflects optimism regarding its future prospects. Trading at a CMP of Rs. 674.80 as of December 09, 2024, the company is a strong contender in the green hydrogen stocks list, ideal for investors looking for high-growth opportunities.

• GAIL (India) Ltd.

GAIL (India) Ltd., India’s leading natural gas company, is expanding its portfolio by investing in green hydrogen projects. Its strategic initiatives in green hydrogen production position it as a key player in the green hydrogen stocks list.

With a PE ratio of 11.89 and a dividend yield of 2.63%, the company offers a combination of growth and income potential. GAIL’s impressive 3-year revenue CAGR of 18% reflects its ability to capitalise on emerging energy trends. Investors looking for long-term wealth creation opportunities from the best green hydrogen stocks in India could consider investing in GAIL.    

• Larsen & Toubro Ltd.

Larsen & Toubro Ltd. is a major infrastructure and engineering entity in the country. The company had recently commissioned an electrolyser that can produce about 200 Nm3/Hr of green hydrogen. L&T’s innovative approach makes it one of the best green hydrogen stocks in India for investors seeking long-term growth. 

Being one of the entities in the green hydrogen stocks list, L&T demonstrates strong financial performance with a market capitalisation of Rs. 5,42,874.07 crore as of December 09, 2024, a PE ratio of 40.14, and an EPS of 98.35. 

What Factors to Check Before Investing in Green Hydrogen Stocks?

Before investing in green hydrogen stocks in India, you must evaluate several factors to ensure that the company you wish to invest in has potential. Some crucial factors to analyse before you invest include the following: 

• Government Policies and Incentives

Before investing, check for supportive policies, industry subsidies and funding initiatives in India that boost hydrogen production. These factors directly impact the profitability of green hydrogen stocks in India and determine their long-term growth potential.

• Company’s Technological Capabilities

Focus on investing in companies with advanced technologies for hydrogen production and storage. Firms with innovative solutions are often included in the top 10 green hydrogen stocks in India, making them potentially rewarding over the long term. 

• Market Demand and Applications

The growing demand for green hydrogen across sectors like energy, transportation and industrial processes is another key factor. Companies catering to diverse applications are usually popular choices in the green hydrogen stocks list. 

• Financial Health of Companies

A company’s revenue, debt levels and profitability are crucial indicators of its resilience. Many hydrogen stocks in India may be in their growth stage, so assessing their financial strength ensures you pick companies that can sustain their operations over the years.

• ESG Compliance and Sustainability Goals

Companies with strong ESG scores often feature among the best green hydrogen stocks in India. To gauge their long-term viability, you must analyse their sustainability initiatives and check if they adhere to global environmental standards.

How to Evaluate Investment Opportunities in Green Hydrogen Stocks 

Finding the top 10 green hydrogen stocks in India can be easy if you know how to evaluate the companies in this industry. Here is a handy guide to evaluating potential investment opportunities in this market segment. 

• Assess Production Costs and Efficiency

A company’s ability to produce green hydrogen cost-effectively is key to determining its success. Businesses excelling in these areas frequently appear in the top 10 green hydrogen stocks in India, making them worth considering for your portfolio.

• Analyse Infrastructure and Supply Chain

Companies with well-established supply chains and infrastructure also tend to dominate the green hydrogen stocks list. So, assess the capacity of these companies to handle large-scale projects and meet increasing demand sustainably and efficiently.

• Study Partnerships and Collaborations

Strategic partnerships with energy companies, governments and research institutions enhance a company’s growth prospects. Many hydrogen stocks in India rise in value due to such collaborations, so look for firms leveraging such partnerships.

• Track Market Share and Growth Projections

Companies with a significant market share and strong future growth prospects often stand out. Check their presence across sectors and regions because companies with the best green hydrogen stocks in India focus on diversified applications.

• Examine Regulatory Compliance and Funding

Green hydrogen companies must adhere to stringent regulations while securing funding for expansion. Firms meeting these criteria without operational disruptions are common in the top 10 green hydrogen stocks in India. 

How to Invest in the Best Green Hydrogen Stocks?

If you have found the best green hydrogen companies to include in your portfolio, all that remains is to figure out how to invest in them. Samco Securities makes it easy to invest in the best green hydrogen stocks in India. Here is what you need to do to get started.

• Research Companies Thoroughly

Start by researching the companies on the green hydrogen stocks list. Look into their financials, growth potential and industry reputation. Compare key metrics like revenue, debt and R&D investments. This will help you know the company before investing your money.

• Check Stock Availability on Platforms

Ensure the best green hydrogen stocks in India are listed on your preferred trading platform. Platforms like Samco Securities make it easy to find and invest in these stocks. A user-friendly platform with detailed data can simplify your investment process.

• Analyse Stock Performance

Study the historical performance of hydrogen stocks in India. Look for consistent returns and resilience during market downturns. Past performance isn’t everything, but it offers insights into how a stock could perform in the future.

• Diversify Your Portfolio

Don’t put all your funds into a single company. Invest in multiple companies from the top 10 green hydrogen stocks in India to spread risk. A diversified portfolio can protect you from losses and boost your chances of earning steady returns.

• Monitor Industry Trends

Stay updated on green hydrogen policies, technologies and market demand. These factors heavily influence the value of the best green hydrogen stocks in India. By regularly reviewing trends, you can make smarter decisions and adjust your investments as needed.

Challenges in the Green Hydrogen Industry

The green hydrogen industry in India holds great promise because of the growing shift to renewable energy across the world. However, it’s not without its challenges. Here is a closer look at the short-term hurdles that companies in the green hydrogen stocks list need to tackle before they can capitalise on the growth opportunities.

• High Production Costs

Producing green hydrogen remains expensive due to reliance on renewable electricity and advanced electrolyser technology. The cost of green hydrogen in India is approximately $4–$5 per kilogram, significantly higher than grey hydrogen. This disparity limits its adoption in price-sensitive markets​.

• Infrastructure Gaps

India requires improved infrastructure for hydrogen storage, transportation and distribution. Green hydrogen’s low energy density and flammability demand specialised handling systems. So, investments in pipelines and storage facilities are essential to scale operations.

• Dependence on Critical Minerals

Electrolysers require scarce materials like platinum and iridium, which India must largely import. Limited access to these resources could hinder large-scale manufacturing and increase costs for companies in the green hydrogen stocks list​.

• Energy Efficiency Issues

Green hydrogen production loses about 30% of energy during electrolysis, making it less efficient than other renewable technologies. This inefficiency impacts its competitiveness against conventional fuels​.

Future Outlook of the Hydrogen Stocks in India

Despite the challenges discussed above, the best companies in the green hydrogen stocks list​ in India have the management strength and the operational efficiency to overcome current barriers. Government and policy support are also making it easier for players in this industry to become more efficient and profitable.

All in all, the future of green hydrogen stocks in India appears promising due to the nation's commitment to clean energy and green hydrogen policies. The government has set a target to produce 5 million metric tonnes of green hydrogen annually by 2030 and is incentivising investments in this industry through initiatives like the National Green Hydrogen Mission. This aims to make India a global hub for hydrogen production and reduce our reliance on imported fossil fuels.

India's industrial giants are also contributing to the sector's growth. Companies like Reliance Industries and GAIL have announced investments in green hydrogen projects. Reliance, for instance, plans to achieve net-zero carbon emissions by 2035 — a goal that can be achieved by measures like large-scale hydrogen production. 

These moves are expected to create significant opportunities in the best green hydrogen stocks in India as related infrastructure develops. Additionally, the global context supports India's hydrogen ambitions. With worldwide demand for green hydrogen expected to grow sevenfold by 2050, India is strategically positioned to export to countries aiming to decarbonise.