Clean Max Enviro
IPO Size: Rs. 3,100 cr
- Fresh Issue of Rs. 1,200 cr, to repay Rs. 1,123 cr of Rs.9,000 cr net debt
- Offer for Sale (OFS) of Rs. 1,900 cr – 63% of OFS by the promoter (65% to shrink to 49%) and balance 37% by 2 investors (19% combined stake to drop to 11% post IPO)
Price band: Rs. 1,000-1,053 per share
- Company undertook Rs. 297 cr pre-IPO placement at Rs. 1,053 per share to Temasek on 6th Feb 2026
M cap: Rs. 12,325 cr, implying 25% dilution
IPO Date: Mon 23rd Feb to Wed 25th Feb 2026, Listing Mon 2nd Mar 2026
Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.
B2B Renewable Energy Producer
Clean Max Enviro is a 15 year old, Mumbai headquartered power producer, having 2.8 GW operational capacity, in Gujarat and Karnataka, across solar (62%), wind (11%) and hybrid (27%) plants, as of 31st Oct 2025. In addition, it has 3.17 GW contracted capacity, for which power purchase agreement (PPA) signed, but capacity yet to be executed and another 4.95 GW under deployment (of which 3 GW received evacuation approval).
Lower Margins than Peers
H1FY26 revenue stood at Rs. 933 cr, with EBITDA at Rs. 638 cr, or 68% EBITDA margin. This is lower than all renewable energy listed peers - Acme Solar 90%, NTPC Green 87% and Adani Green 82%.
Due to extremely high leverage, with Rs. 10,120 cr gross debt and approximately Rs. 9,000 cr net debt, interest cost stood at Rs. 416 cr in H1FY26, leading to PAT of only Rs. 11 cr for owners. Thus, Clean Max’s net margin of 2% fares poorly vis-à-vis peer net margin of 15-25%.
Huge Debt
IPO proceeds will retire just Rs. 1,123 cr or 11% debt, keeping interest cost elevated, although net debt-to-equity ratio of 3.4x currently will decline to 1.9x, as equity expands. Since company has plans to more than triple capacity, debt will rise to fund capacity expansion. Post IPO, net debt to EBITDA ratio of 6.2x is also high, as against 4.6x for Acme.
Expensive Pricing
M cap of Rs. 12,325 cr and Enterprise Value (EV) of Rs. 20,200 cr implies EV/EBITDA multiple of 16x, on FY26E expected EBITDA of close to Rs. 1,275 cr. This is higher than the most suitable peer, based on size, Acme Solar, having 2.96 GW operational capacity, and ruling at an EV/EBITDA multiple of 11x, FY26E EBITDA of Rs. 2,200 cr and an EV of Rs. 24,200 cr. This is despite Clean Max’ lower EBITDA margin and higher leverage vis-à-vis Acme, for similar capacity.
Final Word
- Rs. 1,200 cr OFS by the promoter (with promoter holding dropping below 50%), instead of further debt reduction, is concerning.
- Huge capital will be required by Clean Max for future capacity expansion.
- Renewable energy stocks are witnessing contraction in valuation multiples, despite huge sector opportunity.
- Both renewable power IPOs - NTPC Green and Acme Solar are 18-20% below respective IPO price, even after 15 months.
