Steel Strips Wheels Expands Investment in Renewable Energy with ₹6.93 Crore in Clean Max Astria

Steel Strips Wheels Limited (SSWL) announced a strategic move further to its intimation dated December 22, 2022, by entering into a Supplementary Shareholders Agreement with Clean Max Astria Private Limited (CMAPL) and its promoter Clean Max Enviro Energy Solutions Private Limited (CMEESPL). 

The agreement, signed on September 10, 2024, outlines SSWL’s additional investment of ₹6.93 crore in CMAPL through a rights issue. This investment is aimed at sourcing additional renewable energy to optimise energy costs and fulfil captive power consumption requirements at SSWL’s plant in Gujarat.

Clean Max Astria Private Limited (CMAPL) was incorporated on May 7, 2022, with a paid-up capital of ₹9.59 lakh and a turnover of ₹23.92 million as per the financial year 2023-24. CMAPL, an associate company of SSWL, specialises in the production, generation, supply, and distribution of wind, solar, and hybrid power. The company is engaged in renewable energy projects, working towards a greener and more sustainable energy future.

The investment of ₹6.93 crore is part of SSWL’s strategy to enhance its shareholding in CMAPL while ensuring that the company remains a captive consumer of renewable energy. To qualify as a captive consumer, SSWL must hold at least 26% of the total capital contribution in the wind and solar power-generating plants operated by CMAPL. The additional investment will maintain SSWL’s 26% stake in CMAPL, with the remaining 74% held by Clean Max Enviro Energy Solutions Private Limited.

This investment will fund the expansion of CMAPL’s wind and solar power capacity. The current project involves increasing the existing 3.3 MW AC wind capacity by an additional 6.6 MW AC and expanding the 2.64 MWp DC solar capacity by an additional 5.28 MWp DC. This additional capacity will be exclusively used by SSWL, with CMAPL acting as the project operator and generator of the energy supplied.

The primary objective of this acquisition is to set up and establish additional renewable energy capacity to meet the company’s energy demands. By entering into an Energy Supply Agreement with CMAPL, SSWL aims to further reduce its energy costs through the optimised use of renewable energy sources. The project is expected to be completed within 30 days of signing the agreement, adding substantial value to the company’s energy optimisation initiatives.

SSWL’s additional investment aligns with its long-term strategy of reducing power costs while supporting sustainable energy practices, reinforcing its commitment to environmental sustainability and cost-efficiency.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.