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 to expand its Lyocell fibre manufacturing capacity at Harihar, Karnataka.
The investment will support Phase II of the company’s Lyocell expansion programme, adding 110,000 tonnes per annum (TPA) through two production lines of 55,000 TPA each. The first line is expected to commence operations in 2028, followed by the second in 2030.
This new expansion follows the ongoing construction of Grasim’s Phase I Lyocell facility at Harihar, which will add 55,000 TPA and is scheduled for commissioning by mid-2027. Once all phases are completed, the company’s total Lyocell production capacity will reach nearly 210,000 TPA, positioning Grasim among the world’s largest Lyocell producers.
Commenting on the announcement, Kumar Mangalam Birla, Chairman of the 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 noted that the investment marks another milestone in Grasim’s strategy to strengthen advanced fibre capabilities and meet rising global demand for sustainable, high-performance textile materials. The expansion is expected to take the company’s overall cellulosic fibre capacity beyond one million tonnes annually by 2030.
Vadiraj Kulkarni, Business Head, Grasim Pulp & Fibre, added:
“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 is widely recognised as a next-generation fibre used across apparel, home textiles, and technical textile applications. Produced through an efficient closed-loop manufacturing process, it offers durability, breathability, comfort, and a comparatively lower environmental footprint.
The expansion will further strengthen Grasim’s specialty fibre portfolio, which includes Lyocell, Modal, dope-dyed, and recycled fibres. By 2030, specialty fibres are expected to account for approximately 35% of the company’s overall product portfolio, reinforcing its position in the global sustainable fibre market.
