Clean Max Enviro Energy Solutions Q1 FY27 earnings call

Clean Max reported robust Q1 FY27 results, with revenues more than doubling by 107% to INR832 crores and Profit After Tax (PAT) reaching INR55 crores. This growth was primarily driven by a 74% increase in cash EBITDA and significant margin expansion across both business segments. The RE Power Sales segment's EBITDA margin improved from 76% to 84%, while RE Services saw an increase from 9% to 11.2%.

The company added a substantial 500 MW of new capacity in Q1 FY27, comprising 400 MW in RE Power Sales and 100 MW in RE Services. This brings the total portfolio of built and under construction capacity to 6.8 GW as of June 30, with 6 GW being total contracted capacity. Management expressed confidence in meeting or exceeding the FY27 target of 1.5 GW minimum new capacity addition, supported by a 3x growth in contracted capacity over the last two years.

Clean Max successfully reduced its weighted average cost of debt by 100 basis points to 8.4% as of June 2026, down from 9.4% in April 2025. The company's net debt stood at INR11,809 crores, with 44% allocated to operational projects and 38% to under-construction assets. Following a credit rating upgrade to AA- from A+, the company is now exploring its first domestic bond issuance, aiming to further optimize its financing structure and ensure consistency with a 1x security cover.

The Data & AI segment continues to be a significant growth driver, representing 42% of contracted capacity and experiencing 10x growth in the last two years. Clean Max holds an estimated 35% market share among hyperscalers in India and anticipates substantial future growth, with 30-60 GW of new renewables needed for the projected 5-10 GW data center capacity. The industrial segment also showed strong growth, doubling contracted volumes in two years with a 46% annual CAGR, driven by low penetration and a strong customer value proposition.

Management views BESS as a natural evolution and a significant growth opportunity, having greenlit its first BESS investment for an STU project in Rajasthan and signed MOUs with three clients. BESS-as-a-Service is expected to command tariffs of INR3-4 per unit for porting electricity from daytime to evening, expanding the addressable market by enabling higher power offset for customers in solar-only states, during peak hours, and for BESS-as-a-Service tenders.

The company provided new guidance for a minimum EBITDA of INR3,000 crores by FY28, representing a 2.4x increase from FY26 EBITDA of INR1,290 crores. This guidance includes both renewable power sales and services segments. Correspondingly, the steady-state net debt for this EBITDA level is projected to be INR16,000 crores, reflecting confidence in future growth and financial stability.

A key concern highlighted was the 70% curtailment at the Bikaner CTU project, which is expected to persist for the remainder of the financial year. This issue impacts approximately 13% of the company's run-rate EBITDA, potentially amounting to INR170 crores on a full-year basis. While management acknowledged the efforts by Power Grid and the government to rectify the issue, they adopted a conservative stance for the current fiscal year.