Diversified Indian firm Grasim Industries Ltd said on Monday it would set up a joint venture in China for a viscose staple fibre manufacturing unit.
Aditya Birla group companies Grasim, Thai Rayon Public Co Ltd and Indonesia's P T Indo Bharat Rayon will take 70 per cent in the joint venture with China's Hubei Jing Wei Chemical Fibre Co, according to a statement from Grasim.
Grasim will hold a little more than 30 per cent in the joint venture.
The joint venture company, Birla Jingwei Fibres Co Ltd, will acquire the existing assets of Jing Wei. The capacity of the joint venture company will be doubled to 60,000 tonnes per annum by December 2007, the statement said.
"The Asian and Chinese markets offer enormous potential for commodity and speciality fibres," Aditya Birla group Chairman Kumar Mangalam Birla said in the statement.
Shares in Grasim were up more than 1 per cent at Rs 2,281.80 at 0820 GMT in a firm Mumbai market.
The joint venture is subject to statutory approvals.
The Aditya Birla group, which also has a joint venture for carbon black in China, is exploring opportunities in phosphoric acid, acrylic fibre and other areas.