Clean Max margin jumps as expenses fall faster than revenue
Consolidated net profit rose 19.30% sequentially, but higher interest and a 45.54% tax rate limited the benefit from the operating margin expansion.
Filed 04 Nov 2026, 00:02 IST · Clean Max Enviro Energy Solutions Ltd (CLEANMAX)
Key takeaways
- Consolidated operating margin widened 21.50 percentage points sequentially to 72.08% as expenses fell 50.60%, faster than the 12.56% decline in revenue.
- Net profit rose 19.30% sequentially to Rs 65.82 cr despite interest costs increasing 13.58% and the tax rate rising 4.24 percentage points.
- Management said it added 550 MW of operational RE Power Sales capacity in H1 FY27 and is guiding for at least 1,500 MW of additions in FY27.
Price around the results
Operating leverage drove the sequential margin rebound
Clean Max reported consolidated revenue of Rs 727.65 cr in Q2FY27, down 12.56% sequentially, while expenses fell 50.60%. That cost decline was more than enough to lift operating margin by 21.50 percentage points to 72.08%. Operating profit therefore increased 24.61%, even as revenue contracted.
Higher finance costs and tax reduced profit conversion
Interest expense rose 13.58% sequentially and depreciation increased 21.54%, partly offsetting the operating improvement. Profit before tax still rose 28.56%, but the tax rate increased 4.24 percentage points to 45.54%, limiting net profit growth to 19.30%. Other income contributed 20.65% of pre-tax profit, so reported earnings also included a material non-operating contribution.
Margin recovered from Q4FY26, but remains volatile
The operating margin moved from 62.29% in Q3FY26 to 48.01% in Q4FY26, 50.58% in Q1FY27 and 72.08% in Q2FY27. This quarter reversed the prior two-quarter decline rather than extending it. The margin was 29.20 percentage points above the 42.88% median for the 16 Utilities peers that had reported the same quarter.
Management highlighted capacity additions and execution issues
Management said repeat business accounted for 85% of new contracted capacity and that 2.6 GW of RE Power Sales capacity was under execution as of September 30, 2026. It also said Data and AI represented 41% of contracted capacity. For the forward plan, management guided to at least 1,500 MW of FY27 capacity additions and a minimum FY28 capacity base of 4.6 GW, while noting that STU projects can take three to six months to stabilize after commissioning.
No immediate market move; past reactions were mixed
The stock has risen after two of its last three results and fallen after one, with a median absolute move of 2.62%. Its recorded post-results moves were +1.04%, +7.86% and -2.62%, indicating that the usual reaction has varied in size and direction.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹728 cr | ₹832 cr | -12.56% |
| Other income | ₹25 cr | ₹42 cr | -41.16% |
| Expenses | ₹203 cr | ₹411 cr | -50.60% |
| Operating profit | ₹525 cr | ₹421 cr | +24.61% |
| Operating margin (%) | 72.08% | 50.58% | — |
| Interest | ₹289 cr | ₹255 cr | +13.58% |
| Depreciation | ₹139 cr | ₹115 cr | +21.54% |
| Profit before tax | ₹121 cr | ₹94 cr | +28.56% |
| Tax | ₹55 cr | ₹39 cr | +41.76% |
| Net profit | ₹66 cr | ₹55 cr | +19.30% |
| EPS (₹) | ₹4.01 | ₹4.14 | -3.14% |
Operating margin of 72.08% compares with a Utilities sector median of 42.88% across 16 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- The company guides to a minimum 4.6 GW capacity base for FY28.
- The company expects minimum FY28 reported EBITDA of INR 3,000 crore.
- The company guides to at least 1,500 MW of RE Power Sales capacity additions in FY27.
Expansion
- The company added 550 MW of operational RE Power Sales capacity in H1 FY27.
- The company plans a minimum FY27 capacity addition of 1,500 MW, taking year-end capacity to at least 4,588 MW.
New orders
- Repeat business represented 85% of new contracted capacity in the current period.
- The company had 2.6 GW of RE Power Sales capacity contracted under execution as of September 30, 2026.
New initiatives
- Data and AI is a key growth theme, accounting for 41% of contracted capacity as of September 30, 2026.
Problems & risks
- STU projects typically require three to six months to stabilize after commissioning because of open-access and regulatory approvals.
- Initial grid evacuation availability for CTU projects such as Bikaner-II has a limited impact on ramp-up.
What to watch
- Whether operating margin holds above 72.08% after the sharp sequential rebound.
- Progress against management's 1,500 MW FY27 capacity-addition guidance.
- Whether interest expense moderates from the 13.58% sequential increase and the tax rate moves below 45.54%.