Production restarts at Grasim’s Nagda plant

Grasim Industries has restarted production at its staple fibre plant and the chlor-alkali unit at Nagda in Madhya Pradesh, with the onset of monsoon and improvement in the availability of water.

''With the onset of monsoon, availability of water has improved and accordingly production in these plants is being restarted in a gradual manner,'' the company said in a filing with the Bombay Stock Exchange (BSE).

''Full production is expected to be restored by 12 July 2012,'' it added.

Grasim Industries, the Aditya Birla Group flagship, had, on 2 July, announced a temporary suspension of operations at its staple fibre plant at Nagda, due to water shortage in the area.

Grasim Industries had also announced partial suspension of operations at its chlor-alkali unit in Nagda in the wake of the acute water shortage.

Grasim had reported an 11 per cent increase in its fiscal fourth quarter sales of viscose staple fibre. Sales volumes for the quarter stood at 94,904 tonnes, up 11 per cent. This was despite a slowdown in the Eurozone, which impacted textile demand and addition of new capacities in China, the company had said while announcing results for the January-March 2011-12 quarter.

Average realisations for the fourth quarter were lower by 16 per cent year-on-year as prices were at their peak, in line with competing fibres' prices in the corresponding quarter of last year.

Lower realisations coupled with increase in the prices of caustic soda and coal, resulted in lower profitability. The impact of rising caustic prices was offset by higher profitability of chemical business, according to the company.