With the onset of monsoon, the production has resumed at the Nagda plant. To further minimise the effect of water shortage in future, the company has built an additional reservoir at Nagda to cater to the company's requirement of water for about 45 days.
The capacity at the Grasim's plant at Harihar was expanded by 9,125 tons towards the end of the quarter, thereby increasing the overall VSF capacity from 257,325 tons to 266,450 tons per annum. Capacity expansion and modernisation at its VSF plants at an outlay of Rs.617 crore will ramp up the VSF capacity to 306,600 tons per annum by FY08.
Production of rayon grade pulp at the newly acquired St. Anne Nackawic Pulp Mill is expected to begin in the third quarter of FY08. This would help in augmenting the supply of quality pulp.
The integrated plantation-cum-pulp plant planned by the company at Laos is on track. This project with a long-term horizon of 7 years will enable the company to source its requirement of quality pulp in adequate quantities upon implementation. The company's investment in the project over a period of 7 years, is estimated at US$ 50 million. (Rs.235 crore).
The increase in exports of garments and fabrics should translate into increased demand for VSF. Besides, the efforts to introduce VSF based non-woven products in the domestic markets, coupled with the increase in prices of competing fibres, bode well for the VSF business. The outlook for the business continues to be positive.
Chemical business - The chemical business' performance was impacted due to water shortage. Production of caustic soda and consequently sales volumes, declined as a result. Realisations were affected due to lower caustic and allied product prices globally.
Grasim Industries Limited
marketing@alchempro.com
