Liberty Shoes Limited (LIBERTSHOE) AI Stock Analysis

• Market Cap: ₹4.34B
• Dividend Yield: N/A
• Average Volume (3M): 2.99K
• Price to Earnings (P/E): 200.9
• Beta (1Y): 1.25
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: IN
• Employees: 2,047
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Footwear & Accessories
• EPS (TTM): 0.35
• Shares Outstanding: 17,040,000
• 10 Day Avg. Volume: 1,345
• 30 Day Avg. Volume: 2,991
• PEG Ratio: 1.94
• Price to Book (P/B): 2.53
• Price to Sales (P/S): 0.83
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: ₹263.00 ▼(-6.29% Downside)
• Action: Reiterated Date: 03/14/26
• Date: Action: Reiterated 03/14/26

The score is driven primarily by moderate financial performance: stable leverage and a modest FY2025 improvement are offset by very thin net margins, sharp gross-margin compression, and weaker/uneven free-cash-flow generation. Technicals are mixed (short-term strength but longer-term weakness and negative MACD), while valuation meaningfully drags the score due to the very high P/E and no dividend yield support.

Positive Factors

Channel Diversification

Operating through both wholesale/distribution and company-operated retail creates durable demand diversification. This mix reduces reliance on any single channel, preserves sell-through insights and pricing control, and supports long-term brand building and margin management across cycles.

Balance Sheet Stability

Manageable leverage (D/E ~0.7) and rising equity provide financial flexibility for capex, working-capital cycles, and modest acquisitions. A reasonably stable balance sheet lowers refinancing risk and supports sustained investment in distribution, product development, and retail footprint expansion.

Operating Profitability

Stable mid-single-digit operating margins offer a persistent earnings buffer above gross profit volatility. With EBITDA ~10% and improving operating profitability on a revenue rebound, the company retains operational leverage to fund brand support and retail investments while pursuing gradual margin improvement.

Negative Factors

Thin Net Margins

A net margin near 2% materially limits retained earnings and the capacity to self-fund growth or absorb cost shocks. Persistently thin net profitability makes long-term return generation sensitive to commodity, labor, or pricing pressure and constrains ability to build reserves for strategic initiatives.

Gross Margin Compression

A structural drop in gross margin of this magnitude signals either rising input costs or weakening pricing power. Such compression erodes the core economic engine, reducing funds available for SG&A and reinvestment and risking sustained profit weakness unless product mix or sourcing is meaningfully improved.

Uneven Cash Generation

Volatile cash conversion and a reported zero FCF in FY2025 indicate working-capital swings or higher investment needs. Inconsistent free cash flow undermines reliable capital allocation, limits buffer for downturns, and weakens the company's ability to sustainably fund expansion or return capital to shareholders.

Liberty Shoes Limited Business Overview & Revenue Model

Company Description

Liberty Shoes Limited manufactures and trades in footwear, accessories, and lifestyle products in India and internationally. The company offers school shoes, sports shoes, fashion, slip-on, formal, and casual footwear under the AHA, Coolers, Footfun, Force 10, Fortune, Gliders, Healers, Leap7X, Perfect, and Senorita brands. It also provides shoe care products; backpacks; belts; wallets, travel bags; and handbags for women. The company operates through 100 distributors and 425 exclusive showrooms, as well as sells its products through retail and e-commerce channels. Liberty Shoes Limited was founded in 1954 and is headquartered in Karnal, India.

How the Company Makes Money

Liberty Shoes Limited primarily makes money by selling footwear products under its brands through (1) wholesale/distribution to independent retailers and other trade partners and (2) direct-to-consumer retail sales via company-operated outlets and other branded selling formats. Revenue is recognized from the sale of finished footwear, where pricing is driven by brand positioning, product mix (e.g., formal vs. casual vs. sports/fashion), volumes shipped to trade channels, and sell-through in retail. Earnings are influenced by factors such as manufacturing and sourcing costs (materials and labor), scale efficiencies in production and distribution, and the strength of its brand-led demand. Specific details on material partnerships, licensing income, or other non-footwear revenue streams are null.

Liberty Shoes Limited Financial Statement Overview

Summary

FY2025 shows a modest rebound in revenue and slightly improved operating profitability, with manageable leverage. However, net margin remains thin (~2.0%), gross margin compressed sharply versus FY2024, and free cash flow is reported as zero in FY2025, indicating uneven earnings quality and cash generation.

Income Statement

Revenue rebounded in FY2025 (up ~2.7% after declines in FY2023–FY2024), and operating profitability improved modestly with EBITDA margin holding near ~10% and EBIT margin around ~5%. However, the company’s net profitability remains thin (FY2025 net margin ~2.0%), and gross margin has compressed sharply versus FY2024 (from ~43.6% to ~30.5%), which raises risk that earnings stay vulnerable to cost and pricing pressure.

Balance Sheet

Leverage appears manageable with debt-to-equity around ~0.70 in FY2025, and equity has grown versus prior years, supporting balance sheet stability. Returns on equity are positive but modest (~6.1% in FY2025), indicating limited value creation relative to the capital base. Overall, the balance sheet is reasonably stable, but not especially high-quality given only moderate profitability.

Cash Flow

Operating cash flow was positive in FY2025 (~₹616m), but it declined from FY2024 and cash conversion is not consistently strong. Free cash flow was positive in FY2022–FY2024, but is reported as zero in FY2025, suggesting weaker cash generation after investment needs or working-capital swings. This variability makes cash flow quality a key watch item despite generally positive operating cash generation.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	6.95B	6.75B	6.36B	6.54B	4.85B	4.56B
Gross Profit	2.87B	2.06B	2.77B	3.30B	1.89B	1.81B
EBITDA	699.61M	668.15M	626.37M	616.27M	452.41M	511.90M
Net Income	132.79M	135.61M	111.58M	129.11M	22.43M	2.51M
Balance Sheet
Total Assets	5.11B	4.97B	4.64B	4.71B	4.32B	5.17B
Cash, Cash Equivalents and Short-Term Investments	39.69M	54.41M	26.29M	36.20M	12.94M	81.38M
Total Debt	1.65B	1.56B	1.47B	1.60B	1.25B	1.71B
Total Liabilities	2.83B	2.74B	2.55B	2.73B	2.43B	3.31B
Stockholders Equity	2.28B	2.23B	2.09B	1.98B	1.89B	1.86B
Cash Flow
Free Cash Flow	128.72M	0.00	320.58M	333.84M	183.43M	155.88M
Operating Cash Flow	266.66M	616.37M	749.70M	939.88M	378.79M	335.94M
Investing Cash Flow	-136.08M	-444.82M	-444.13M	-556.79M	-87.08M	-90.68M
Financing Cash Flow	-150.67M	-167.25M	-432.30M	-386.85M	-304.15M	-240.84M

Liberty Shoes Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MONTECARLO	64 Neutral	₹10.82B	3.10	―	2.83%	8.10%	59.25%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BATAINDIA	56 Neutral	₹86.48B	45.84	―	0.95%	-0.95%	-50.96%
RELAXO	56 Neutral	₹71.11B	94.83	―	0.75%	-8.39%	-3.74%
LIBERTSHOE	52 Neutral	₹4.34B	200.89	―	―	―	―