Startup HYDGEN has commenced operations at its new 20 MW electrolyser plant in Mangaluru, producing PEM and AEM systems for industrial hydrogen. For investors, the key monitorable will be the company’s ability to compete with large conglomerates in the growing green hydrogen sector and secure orders under government incentive schemes.
HYDGEN has officially opened its manufacturing facility in Mangaluru, with an annual capacity of 20 MW for producing electrolyser systems. Electrolysers are the core technology in the green hydrogen value chain, acting as the machines that use electricity to split water into hydrogen and oxygen. This new plant focuses on assembling Proton Exchange Membrane (PEM) and Anion Exchange Membrane (AEM) units, including a newly introduced 250 kW system designed for industrial clients who need on-site hydrogen production.
The launch comes as India pushes forward with its National Green Hydrogen Mission. The goal of this mission is to establish India as a global hub for green hydrogen production. By localizing the assembly of these machines, HYDGEN is attempting to reduce reliance on imports and lower the cost of green hydrogen for domestic industries, which is essential for scaling up the use of cleaner fuel.
From an investor and market perspective, this is a niche but evolving sector. While 20 MW is a useful capacity for a startup to prove its technology, it is relatively small compared to the gigawatt-scale manufacturing plans announced by larger industrial conglomerates. Major players like Reliance, Adani, L&T, and Ohmium are already heavily invested in this space, aiming for much larger volumes. For a smaller company, the primary challenge is to maintain cost competitiveness against these large, established players that benefit from significant economies of scale and deep pockets for research and development.
Another factor investors should watch is the role of the government’s Strategic Interventions for Green Hydrogen Transition (SIGHT) scheme. This program provides financial incentives for the domestic manufacturing of electrolysers. The ability of HYDGEN to qualify for and receive these incentives will likely play a role in its financial stability and long-term viability. Without these supports, the high capital expenditure required to build and run such a facility could put pressure on cash flows.
The project is also linked to the local 'Back to Ooru' initiative, which aims to boost regional manufacturing and employment in Dakshina Kannada. While this highlights local economic support, the company's success will ultimately depend on its ability to secure consistent orders from industrial sectors like steel, cement, and fertilizers, which are expected to be the primary users of green hydrogen.
Moving forward, investors and industry watchers should monitor a few critical updates. First is the company’s order book, which will show how much demand exists for its specific 250 kW AEM and PEM units. Second, the cost-efficiency of these units compared to imports and established domestic competitors will be a major determinant of market share. Finally, any further expansion plans or new partnerships will clarify whether the company can scale its production to match the high demands of the broader energy transition.