Grasim to invest Rs 3,094 crore to expand Lyocell capacity in Karnataka

MUMBAI: Grasim Industries has approved a plan to spend Rs 3,094 crore on the second phase of its Lyocell plant at Harihar in Karnataka.

The first phase of this plant will have a capacity of 55,000 tonnes each year, while the second will add another 110,000 tonnes capacity.

The under-construction first phase is set to be commissioned by mid-2027. The second phase will have two lines, with the first line set to be commissioned in 2028 and the second in 2030.


“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,” Kumar Mangalam Birla, the chairman of the Aditya Birla Group, said. “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.”

Lyocell, a semi-synthetic fibre, is used across apparel, home textiles and technical textile applications. Grasim already produces Lyocell at one of its plants in Gujarat. The completion of both the phases at its plant in Harihar in Karnataka will make it one of the largest producers of Lyocell globally, with a capacity of 210,000 tonnes per annum.

“By expanding Lyocell capacity, we are accelerating the shift towards high-performance fibres with a lower environmental impact,” Vadiraj Kulkarni, the business head for Grasim Pulp & Fibre, said. “Lyocell enhances our product mix, supports premium applications and aligns with our focus on delivering differentiated, sustainable solutions to global markets.”

In FY26, Grasim Industries had a revenue of Rs 17,104 crore from its cellulosic fibres business, while earnings before interest, tax, depreciation and amortisation stood at Rs 1,751 crore.