The Harihar expansion will lift Grasim’s lyocell capacity to nearly 210,000 tonnes a year and push its total cellulosic fibre capacity beyond 1 million tonnes by 2030.
Grasim Industries, the flagship company of the Aditya Birla Group, has approved a fresh ₹3,094 crore investment to expand lyocell production at Harihar in Karnataka, strengthening India’s position in the fast-growing market for man-made cellulosic fibres. The Phase II project will add 110,000 tonnes per annum through two production lines of 55,000 tonnes each.
Capacity moves in stages
The first new line is expected to be commissioned in 2028, followed by the second in 2030. This will build on Grasim’s Phase I lyocell plant at Harihar, which is already under construction and scheduled for commissioning by mid-2027 with 55,000 tonnes per annum of capacity. Once both phases are complete, Grasim’s lyocell capacity will reach nearly 210,000 tonnes annually.
The company said the investment will be funded through a mix of internal accruals and borrowings. The expansion is designed to capture rising demand for sustainable and high-performance textile materials across apparel, home textiles and technical textiles.
Why lyocell matters
Lyocell is gaining importance because it combines comfort, breathability and durability with a lower-impact production route. It is produced through a closed-loop process, making it attractive to brands seeking alternatives to conventional fibres as sustainability scrutiny increases across global supply chains.
For Grasim, the project also sharpens its specialty fibre portfolio. The company expects specialty products—including lyocell, modal, dope-dyed and recycled fibres—to account for 35% of its portfolio by 2030.
A stronger MMCF position
The expansion will lift Grasim’s total cellulosic staple fibre capacity above 1 million tonnes per annum by 2030, reinforcing its position in man-made cellulosic fibres. The key issue now will be execution: timely commissioning, cost control, and whether global brands translate sustainability targets into larger orders for premium cellulosic fibres.
