Birla Cellulose lines up Rs 350 crore expansion

Birla Cellulose, the fibre division of the $6.5 billion Aditya Birla group and the only producer of cellulosic fibres in the country, is investing Rs 350 crore in an expansion exercise in its Kharach plant near Surat. This will increase the plant's capacity by about 18 per cent to 314,000 tonne of fibre a year.

The capacity expansion will only cater to the domestic industry, of which the company has a wide clientele as the sole producer of the environment friendly fibre that is derived from wood pulp.

Currently, the company exports about 30 per cent of its produce to over 34 countries and the client list abroad includes names like Gap, Target and Marks and Spencer.

"The entire capacity addition will be tuned towards domestic demand. We are increasing capacity of non-wovens by 40 tonnes per day and that of high-tenacity fibre by 90 tonnes a day," said Grasim Industries Ltd chief marketing officer Vijay Kaul.

The company, which has a turnover of Rs 2,100 crore for 2005-06, is present across the entire value chain from fibres, spinning, weaving, processing and garmenting and its produce spans the non-wovens, garments and home textiles segments.

After initially making a foray into the first generation cellulose fibre viscose in the 1950's, the company then brought out the next generation fibre modal followed by the third generation fibre excel about a year back.

The company has three plants in India at Nagda (Rajasthan), Kharach (Gujarat) and Harihar (Karnataka) apart from units in Indonesia, Thailand and two pulp making plants in Canada, one of which it acquired in 2004.

In India, the group is the single largest producer of viscose filament yarn, grey cement (at a single location), white cement and rayon grade pulp, the only producer of linen and a leader in the ready-to-wear branded apparel.