Is NG.L (National Grid plc) Halal or Haram?

Based on our AAOIFI-standard shariah screening, NG.L is classified as Doubtful. It passed 3 of 4 compliance screens. Some scholars may permit investing with income purification, while others advise avoiding it. We recommend consulting a qualified Islamic scholar before investing in NG.L.

National Grid plc is a transatlantic energy giant responsible for the critical infrastructure that keeps the lights on in the UK and parts of the US. Its core operations involve high-voltage electricity transmission networks in England and Wales, as well as gas and electricity distribution across the Midlands, South West England, New York, and New England. As a regulated monopoly in many of its territories, it operates the essential 'motorways' of the energy grid rather than just generating power. For Muslim investors using HalalStocks.co.uk, National Grid presents a classic dilemma often found in the utilities sector. While the business activity itself is completely permissible—providing essential energy services—the stock is currently marked as 'Doubtful' because it fails the financial screening criteria. specifically, the company carries a high level of interest-bearing debt compared to its market value, failing the leverage screen significantly. From a financial perspective, the key hurdle is the Debt-to-Market Cap ratio of 69.9%, which far exceeds the 33% threshold set by AAOIFI standards. Utility companies inherently require massive capital expenditure to maintain cables and pipelines , often funded through debt, but this level is currently too high for strict shariah compliance. However, investors should note that the company comfortably passes the interest income screen at just 1.86%, meaning its core revenue is not derived from impermissible financial activities. Investors interested in the defensive nature of utility stocks should monitor National Grid's balance sheet closely. If the company undertakes significant deleveraging or if its market capitalization rises sharply enough to dilute the debt ratio, its compliance status could change . Until then, the high leverage remains a primary blocking point for shariah-conscious portfolios. National Grid plc operates in the Utilities sector under the Regulated Electric industry and is headquartered in London, GB. The company is led by CEO Zoe A. Yujnovich and employs approximately 31,425 people.

NG.L was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. NG.L passed 3 of these 4 screens.

NG.L was last screened on 2026-03-01. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.