Grasim Industries Limited, the flagship company of the Aditya Birla Group and a leading manufacturer of cellulosic fibres, has approved an investment of Rs. 3,094 crore (US $323 million) to establish Phase II of its Lyocell manufacturing facility at Harihar, Karnataka.
The expansion will add 110,000 tonnes per annum (TPA) of Lyocell capacity through two production lines of 55,000 TPA each, equivalent to 150 tonnes per day per line. The first line is scheduled for commissioning in 2028, while the second is expected to become operational by 2030.
The new investment will complement the Phase I Lyocell plant, which is currently under construction at the Harihar site. With a capacity of 55,000 TPA, the Phase I facility is expected to be commissioned by mid-2027.
Upon completion of both phases, Grasim’s total Lyocell production capacity will reach nearly 210,000 TPA, positioning the company among the largest Lyocell producers globally.
Kumar Mangalam Birla, Chairman, Aditya Birla Group, said, “This investment marks another significant step in Grasim’s strategic expansion of advanced fibre capabilities, catering to the growing global demand for sustainable and high-performance textile materials. This fresh expansion will catapult Grasim’s overall Cellulosic Fibres capacity beyond 1 million tonnes per annum, reinforcing its position as a global leader in sustainable Man-Made Cellulosic Fibres (MMCF).”
Vadiraj Kulkarni, Business Head, Grasim Pulp & Fibre added, “By expanding Lyocell capacity, we are accelerating the shift towards high performance fibres with a lower environmental impact. Lyocell enhances our product mix, supports premium applications, and aligns with our focus on delivering differentiated, sustainable solutions to global markets.”
Lyocell is a next-generation fibre used across apparel, home textiles and technical textile applications. Produced through a highly efficient closed-loop manufacturing process, the fibre is known for its durability, breathability, comfort and comparatively lower environmental impact.
The expansion is expected to strengthen Grasim’s specialty fibre portfolio and reinforce its position in the global sustainable fibre market. The company expects the share of specialty products in its portfolio—including Lyocell, Modal, dope-dyed and recycled fibres—to increase to 35% by 2030.
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