Grasim Industries Limited, the flagship company of the Aditya Birla Group and a global leader in cellulosic fibres, has announced a fresh investment of ₹3,094 crore for the Phase-II expansion of its Lyocell manufacturing capacity at Harihar, Karnataka.
The expansion will add 110,000 tonnes per annum (TPA) of Lyocell capacity through two production lines of 55,000 TPA (150 tonnes per day) each. The first line is expected to be commissioned by 2028, followed by the second line in 2030.
The newly approved investment will complement the company’s ongoing Phase-I Lyocell project of 55,000 TPA, currently under construction at the same location and scheduled for commissioning by mid-2027. Upon completion of both phases, Grasim’s total Lyocell capacity will reach nearly 210,000 TPA, positioning it among the world’s largest Lyocell producers.
Commenting on the development, Kumar Mangalam Birla, Chairman, Aditya Birla Group, said,
“The Aditya Birla Group has always demonstrated the willingness to invest ahead of the curve in sectors that will define India’s future competitiveness and economic resilience. This investment carries forward that legacy. It is a vote of confidence in the scale and promise of the Indian market, aligns closely with the aspirations of Make in India, and will help position India as a more competitive and resilient force in the global textile industry.”
He further added, “This investment also 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).”
Sharing his views on the expansion, Vadiraj Kulkarni, Business Head – Grasim Pulp & Fibre, said,
“This expansion strengthens our position in the evolving MMCF landscape by scaling a high-value, future-ready fibre segment. 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, versatile fibre widely used in apparel, home textiles and technical textile applications. Produced through an environmentally responsible closed-loop manufacturing process, the fibre offers a unique combination of softness, durability, breathability and comfort while significantly reducing environmental impact.
The expansion is expected to further strengthen Grasim’s specialty fibre portfolio and reinforce its leadership position in the global sustainable fibre industry. The company projects that specialty products—including Lyocell, Modal, Dope-Dyed and Recycled fibres—will account for 35% of its overall portfolio by 2030, reflecting its strategic focus on innovation, sustainability and value-added fibre solutions.
With global brands and manufacturers increasingly seeking sustainable raw material alternatives, Grasim’s latest investment is expected to play a significant role in supporting the industry’s transition towards more responsible and circular textile production systems.
