News Flash

Sales volumes for Grasim VSF business higher

30 Apr '08

3 min read

To meet the growing demand, the company plans to increase its capacity at Harihar (Karnataka) by 31,000 tonnes at an outlay of Rs. 335 crore, which is expected to be operational in Q3FY10. Also, an 88,000 tpa greenfield project is being pursued at Vilayat (Gujarat). The conversion of the AV Nackawic plant from paper grade pulp to rayon grade pulp is expected to be completed in Q2FY09.

Margins in VSF business are expected to remain depressed in the short to medium term due to rising prices of sulphur and pulp, coupled with softening of VSF prices.

Chemical plant:
The chemical business posted a moderate performance during the quarter. Production was marginally lower at 46,491 tonnes. Sales volumes were lower by 6 per cent at 44,872 tonnes on account of inventory buildup for planned partial shutdown.

For the year under review, the performance has improved. Production, which was affected in the corresponding year due to breakdown of a captive power plant, grew by 38 per cent at 188,537 tonnes. Sales volumes too rose by 36 per cent at 187,356 tonnes. It's performance would have been better but for the cost pressure on key inputs and fall in realisation.

Outlook:
Going forward, VSF and cement will continue to be the growth enablers. Shoring up of its leadership position in the VSF and cement sectors, cost optimisation, maximisation of asset productivity and prudent financial management will continue to be the company's hallmarks. The prospects for the company continue to be positive.

Grasim Industries Limited

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