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CleanMax Solar raises $15 million from World Bank's IFC

Mumbai: American private equity major Warburg Pincus-backed rooftop solar company CleanMax Solar has raised $15 million in equity capital from World Bank arm International Finance Corp. (IFC), said a senior executive of the firm.

CleanMax Solar focuses on providing clean energy to corporates through rooftop and grid-connected solar installations. The company was founded in 2011, and has successfully installed more than 200 projects for over 50 leading corporate clients.

The company’s clients include the Tata group, the Mahindra group, TVS group, Mindtree Ltd, United Breweries Ltd, Manipal Education & Medical Group, and SKF India Ltd.

The funding by IFC takes CleanMax’s total institutional fund-raising to $100 million. In July, Warburg Pincus invested in CleanMax.

“IFC is a global leader in clean energy investment. This is the first time, anywhere in the world, that World Bank and IFC have made an equity investment in a rooftop solar company,” said Kuldeep Jain, founder and managing director of CleanMax Solar.

CleanMax will deploy the funds raised from IFC for adding new capacity, he said.

“In FY2016-17 we did around 92 megawatts (MW) of total new instalments. This fiscal we are on track to exceed 300-325MW of new capacity addition,” said Jain.

He added that CleanMax will end up at around 500MW of cumulative installed capacity by the end of this fiscal.

In the next three years the company plans to at least double its capacity.

“Within three years we should have 1 gigawatt (GW) commissioned. If by end of this year we reach half of that then reaching 1GW should not be a difficult target,” Jain said.

A significant portion of this new capacity is expected to come from overseas markets.

“We have entered the Middle East market. In April, we started in Dubai and we have begun installing plants and signing contracts. While it is small part of the business right now, we are hoping that in three years it can become around 20-25% of our business,” Jain said.

The expansion into international markets came on the back of CleanMax’s existing multinational clients and Indian clients with an international presence.

“A lot of our clients are multinationals and they wanted us to replicate that in other markets too. Dubai has been a first and natural market of choice. But we will now be expanding into Southeast Asia as well. By April 2018, we expect to sign client contracts in that market,” Jain said.

IFC is a major investor in Indian renewable energy businesses, having invested in several utility scale renewable power producers. In January 2016, IFC invested $125 million in Hero Future Energies, the renewable energy arm of the Hero Group, for an undisclosed equity stake.

“IFC sees distributed generation segment playing a very important role in India’s future energy mix. The government of India has also laid strong emphasis on this segment,” said Hyun-Chan Cho, regional industry head, infrastructure and natural resources at IFC.

“In a short span of time, CleanMax Solar has established itself as the market leader in corporate sustainability space, with an impressive client list and a strong management team which has contributed to our decision to invest in the company,” he added.