Green hydrogen is slowly moving from idea to execution in India. The government has set a target of producing 5 million metric tonnes by 2030. Pilot projects have already begun in industrial clusters and ports. A recent PIB release highlights that this push is now part of India’s long-term energy and manufacturing strategy.
The National Green Hydrogen Mission has provided clear policy support. Incentives are being rolled out for production as well as domestic electrolyser manufacturing. The focus is on building capacity within the country and reducing dependence on imports. PIB has also noted the potential for investment, job creation and export opportunities as the ecosystem develops.
In all, the National Green Hydrogen Mission is expected to leverage over ₹8 lakh crore (₹8 trillion) in total investments by 2030.
This makes the current phase important for investors to track. The sector is still early. Most projects are in pilot or expansion stages. However, capital commitments from both public and private players are increasing. As renewable energy costs decline, green hydrogen economics could gradually improve.
The selected stocks reflect different layers of this ecosystem. The basket includes infrastructure builders, power producers, refinery users and fertiliser-linked players. This approach spreads exposure across production, equipment and end use. It avoids concentration in just one segment of the theme.
#1 The Infrastructure Backbone: L&T’s Role in System Supply
Larsen and Toubro (L&T) is a multinational conglomerate which is primarily engaged in providing engineering, procurement and construction (EPC) solutions in key sectors such as infrastructure, hydrocarbon, power, process industries and defence, information technology, and financial services in domestic and international markets.
Larsen & Toubro reported record order inflows of Rs 1.36 trillion in Q3 FY26, up 17% compared to last year. Its total order book rose 30% to Rs 7.3 trillion as of December 2025. Orders came from both India and overseas markets, with energy and infrastructure contributing meaningfully.
For the three months ended December, revenue stood at Rs 714 billion, up 10% year-on-year (YoY). Recurring net profit increased 31% to Rs 44 billion. Reported net profit declined 4% to Rs 32 billion due to a one-time provision linked to the new labour codes.
Within energy, the company secured large orders in hydrocarbon and its CarbonLite Solutions vertical. Management also said it has developed an indigenous electrolyser stack and is upgrading it further. This positions the company to participate in green hydrogen projects as investments in clean energy pick up.
In the hydrogen ecosystem, L&T represents the infrastructure layer. It builds and supplies the systems required for hydrogen production. The theme supports long-term order visibility rather than near-term earnings shifts.
In the past year, Larsen Toubro share price rallied 27.1%
Larsen Toubro 1 Year Share Price Chart
#2 The Utility Powerhouse: NTPC’s Renewable Integration
NTPC (National Thermal Power Corporation) along with its subsidiaries/ associates & join ventures (JVs) is primarily involved in generation and sale of bulk power to State power utilities. Other business of the group includes providing consultancy, project management & supervision, energy trading, oil & gas exploration and coal mining.
NTPC added 1,744 MW of capacity in the December quarter. This included 800 MW at Patratu, 694 MW of renewables and 250 MW from a pumped storage project. Total capacity addition in FY26 so far stands at 6,615 MW. The company now has over 33 GW under construction across coal, hydro and renewable projects.
For the three months ended December 2025, standalone total income was Rs 41,673 crore compared with Rs 42,303 crore a year earlier. Profit after tax rose 5.8% YoY to Rs 4,987 crore.
In clean energy, NTPC is also progressing green hydrogen and green ammonia initiatives through its renewable arm. It has secured a bid to supply 70,000 metric tonnes per annum of green ammonia and is integrating renewable capacity to support such projects. Management said the company is balancing conventional generation with renewables and emerging fuels as part of its long-term growth plan.
The company is expanding its renewable portfolio alongside conventional generation. In the hydrogen ecosystem, NTPC fits as a producer. It can use renewable power to generate green hydrogen at scale. The transition will be gradual, but capacity expansion gives it structural positioning.
In the past year, NTPC share price has surged 20.2%.
NTPC Share Price 1-Year Share Price Chart
#3 The Private Scale-Up: JSW Energy’s Early Commissioning Advantage
JSW Energy, a part of the JSW Group, and its subsidiaries are primarily engaged in the business of generation of power from its power assets located at Karnataka, Maharashtra, Nandyal and Salboni. It is the holding company for the JSW group’s power business.
JSW Energy reported strong quarterly growth, driven by higher generation and new capacity. Revenue for the three months ended December rose 61% YoY to Rs 4,255 crore. Net profit climbed 150% to Rs 420 crore, aided partly by a deferred tax impact.
Power sales during the quarter grew 65% to 11.1 billion units. Most of this was backed by long-term power purchase agreements, which helped maintain steady realisations. Over the past year, the company added 5.2 GW of capacity, taking total installed capacity to 13.3 GW.
During the quarter, JSW Energy commissioned a 3,800 tonnes per annum green hydrogen plant at Vijayanagar. It also secured fresh capacity at Salboni under long-term contracts. Management indicated that project execution and capacity expansion remain central to its growth strategy.
In the hydrogen ecosystem, it represents a private-sector production play. Scale remains modest for now, but early commissioning gives it operational experience in the segment.
In the past year, JSW Energy share price is up 2.5%.
JSW Energy Share Price 1-Year Share Price Chart
#4 The Refining Giant: Indian Oil’s Pivot from Grey to Green
Indian Oil Corporation is a Maharatna Company controlled by GOI. that has business interests straddling the entire hydrocarbon value chain – from Refining, Pipeline transportation and marketing of Petroleum products to R&D, Exploration & production, marketing of natural gas and petrochemicals. It has the leadership position in the Oil refining & petroleum marketing sector of India.
Indian Oil Corporation reported steady growth in the December quarter. Revenue for Q3 stood at Rs 205,157 crore up 5.7% YoY. Profit after tax stood Rs 12,126 crore in Q3 FY26, up 528% YoY driven by stronger refining margins, improved marketing spreads and favourable inventory gains during the quarter. Gross refining margin was $12.22 per barrel, which supported overall earnings.
Refineries processed 19.4 million metric tonnes of crude during the quarter. Capacity utilisation remained strong at 109.7%. Marketing sales volumes were 27.18 MMT, showing consistent fuel demand in the domestic market.
The company continues to push ahead with refinery expansion projects at Panipat, Gujarat and Barauni. Physical progress at these units is above 85%, with commissioning planned over FY25 and FY26.
Capex during the first nine months of FY26 was Rs 24,336 crore against a target of Rs 34,701 crore. The expansion pipeline should lift capacity, though margins will remain linked to crude prices and market spreads.
Within the green hydrogen ecosystem, Indian Oil represents the “user” segment. Refineries already consume hydrogen in large volumes. As cleaner hydrogen becomes commercially viable, large refiners are expected to gradually shift from grey to green sources.
In the past year, Indian Oil Corporation share price rallied 47.9%
Indian Oil Corporation 1 Year Share Price Chart
#5 The Industrial Feedstock Play: GSFC’s Ammonia-led Transition
Incorporated in 1962, Gujarat State Fertilizers & Chemicals is a public sector company promoted by the Government of Gujarat. It is engaged in manufacturing of various fertilizers and industrial products like plastics & synthetic rubbers and man-made fibres.
Gujarat State Fertilizers & Chemicals reported a modest rise in revenue in the December quarter. Revenue from operations increased 5% YoY to Rs 2,894 crore in Q3 FY26. Profit before tax rose 18% to Rs 181 crore. Net profit was up 32% at Rs 157 crore.
Fertilizer production during the quarter was 5.06 lakh metric tonnes. This was the highest quarterly output in five years. Input costs were on the higher side this quarter. Phosphoric acid and sulphur were expensive. That reduced margins. The industrial products business was steady. Melamine exports were decent. Ammonia trading volumes were better than before.
In January 2026, the company started operations at a sulphuric acid plant with capacity of 198 kilo tones per annum (KTPA). Additional projects at Sikka are progressing. Earnings going forward will depend on raw material prices and fertiliser demand.
Within the green hydrogen ecosystem, GSFC fits into the user segment. Fertilizer production depends heavily on hydrogen, especially in ammonia manufacturing. As green hydrogen becomes commercially viable, fertilizer players could gradually shift from grey to cleaner sources.
In the past year, Gujarat State Fertilizers & Chemicals share price is down 9.6%
Gujarat State Fertilizers & Chemicals 1 Year Share Price Chart
Comparative Analysis: Valuing the Green Hydrogen Leaders
Let’s now turn to the valuations of the companies in focus, using the Enterprise Value to EBITDA multiple as a yardstick.
Valuations of Companies in focus
| Sr No | Company | EV/EBITDA Ratio | 5-Year Average EV/EBITDA | ROCE |
| 1 | Larsen Toubro | 16.9 | 15.4 | 14.5% |
| 2 | NTPC | 9.1 | 8.5 | 9.9% |
| 3 | JSW Energy | 14.9 | 17.7 | 6.5% |
| 4 | Indian Oil Corporation | 5.4 | 5.5 | 7.4% |
| 5 | Gujarat State Fertilisers and Chemicals | 5.7 | 5.5 | 6.2% |
Larsen & Toubro is trading at 16.9 times, a bit higher than its five-year average of 15.4 times. Its ROCE is 14.5%, which is relatively strong. NTPC is at 9.1 times versus an average of 8.5 times. Its ROCE is 9.9%, reflecting steady but regulated returns.
JSW Energy is trading at 14.9 times, lower than its five-year average of 17.7 times. However, its ROCE is 6.5%, which remains modest. Indian Oil is at 5.4 times, almost in line with its historical average of 5.5 times, with a ROCE of 7.4%. GSFC is at 5.7 times versus 5.5 times historically, with ROCE of 6.2%.
Valuations look broadly in line with past levels. The real question is whether future hydrogen investments can lift returns meaningfully.
Conclusion
Green hydrogen is an interesting theme. But it is still in the early stages. Most companies are talking about plans. Only a few have meaningful execution on the ground. Earnings today are still coming from their core businesses.
The ecosystem will take time to build. Infrastructure will come first. Production will scale slowly. Industrial use will depend on cost competitiveness. This will not change in one or two years.
Valuations are not very stretched. But returns are not very high either. So expectations need to be balanced.
Green hydrogen has long-term potential. But investors should focus on real progress, not just announcements. Execution and capital efficiency will decide who benefits the most.
Disclaimer:
Note: We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Ekta Sonecha Desai has a passion for writing and a deep interest in the equity markets. Combined with an analytical approach, she likes to deep dive into the world of companies, studying their performance, and uncovering insights that bring value to her readers.
Disclosure: The writer and her dependents do not hold the stocks discussed in this article.
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