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Our Bureau

Mumbai, Oct. 25 The financial crisis has finally hit the manufacturing sector where it hurts. Grasim Industries, an Aditya Birla Group company, has decided to curtail production of viscose staple fibre by about 30 per cent of its total capacity of 3.33 lakh tonnes per annum at its units in Nagda in Madhya Pradesh and Kharach in Gujarat.

Mr D.D. Rathi, Chief Financial Officer, said that apart from a large inventory build-up, the unprecedented increase in sulphur prices and higher caustic and pulp prices have adversely impacted profit margins.

The company was unable to pass on cost increases to customers due to a global economic slowdown and fall in demand from the textile industry.

“Considering all the factors, along with the impact of the recent financial crisis which has increased the trade credit risk factor, the company has decided to curtail production of viscose staple fibre by approximately 30 per cent from the current level,” Grasim said in a notice to the BSE.

The company has advanced its maintenance schedule, it added.

More Stories on : Textiles | Outlook | Grasim Industries Ltd

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