Liberty Shoes Limited (LIBERTSHOE) AI Stock Analysis

• Market Cap: ₹4.27B
• Dividend Yield: N/A
• Average Volume (3M): 2.99K
• Price to Earnings (P/E): 32.2
• Beta (1Y): 1.57
• 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): 1.16
• 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: 53 Neutral
• Price Target: ₹255.00 ▼(-9.14% Downside)

The score is primarily constrained by middling financial performance (thin margins, sharp gross margin compression, and inconsistent free cash flow). Technicals are also weak with the stock below key moving averages and negative MACD, while valuation looks demanding at a ~36 P/E without a provided dividend yield to offset.

Positive Factors

Diversified Go-to-Market Model

Operating across wholesale distribution and company retail gives Liberty Shoes structural resilience versus single-channel peers. A mixed channel model supports steady revenue flows, broader consumer reach, and scale in distribution and marketing, helping stabilize top-line over months.

Manageable Leverage & Equity Base

Debt-to-equity near 0.7 and growing equity provide a durable buffer against shocks and meaningful headroom for working-capital cycles. While returns are modest, a reasonable capital structure reduces refinancing risk and supports incremental investment without immediate balance-sheet strain.

Positive Operating Cash Flow & Core Margins

Sustained positive operating cash flow and mid-single-digit operating margins (EBITDA ~10%, EBIT ~5%) indicate the core footwear business generates cash and covers operating needs. This cash generation supports near-term working capital, inventory funding and selective reinvestment over several quarters.

Negative Factors

Very Thin Net Profitability

Net margin around 2% leaves minimal buffer for cost shocks or investment. Persistently thin bottom-line profitability limits internal funding for growth, reduces ability to absorb input-cost inflation, and constrains improvement in return-on-equity absent structural margin recovery.

Sharp Gross Margin Compression

A large gross-margin decline (~13pp) signals material pressure on production costs or pricing power. If structural (sourcing, mix shift or pricing weakness), this erodes operating leverage and makes durability of profits uncertain, requiring sustained cost actions or premium mix to restore margins.

Inconsistent Free Cash Flow & Cash Conversion

Zero free cash flow in FY2025 after prior positives highlights variability in cash conversion. Unreliable FCF constrains capacity to fund capex, reduce debt, or return capital to shareholders without external financing, and raises execution risk for longer-term strategic initiatives.

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 Financial Statement Overview

Summary

Modest FY2025 improvement with revenue rebound and stable leverage, but overall quality is held back by very thin net margin (~2%), a sharp gross margin drop (to ~30.5% from ~43.6%), and uneven cash generation with FY2025 free cash flow reported as zero.

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	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.92B	6.75B	6.36B	6.54B	4.85B	4.56B
Gross Profit	3.28B	2.06B	2.77B	3.30B	1.89B	1.81B
EBITDA	667.89M	668.15M	626.37M	616.27M	452.41M	511.90M
Net Income	122.26M	135.61M	111.58M	129.11M	22.43M	2.51M
Balance Sheet
Total Assets	0.00	4.97B	4.64B	4.71B	4.32B	5.17B
Cash, Cash Equivalents and Short-Term Investments	54.41M	54.41M	26.29M	36.20M	12.94M	81.38M
Total Debt	0.00	1.56B	1.47B	1.60B	1.25B	1.71B
Total Liabilities	-2.23B	2.74B	2.55B	2.73B	2.43B	3.31B
Stockholders Equity	2.23B	2.23B	2.09B	1.98B	1.89B	1.86B
Cash Flow
Free Cash Flow	0.00	0.00	320.58M	333.84M	183.43M	155.88M
Operating Cash Flow	0.00	616.37M	749.70M	939.88M	378.79M	335.94M
Investing Cash Flow	0.00	-444.82M	-444.13M	-556.79M	-87.08M	-90.68M
Financing Cash Flow	0.00	-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	73 Outperform	₹11.80B	12.20	―	2.83%	8.10%	59.25%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BATAINDIA	57 Neutral	₹110.51B	64.81	―	0.95%	-0.95%	-50.96%
RELAXO	56 Neutral	₹97.87B	58.32	―	0.75%	-8.39%	-3.74%
LIBERTSHOE	53 Neutral	₹4.27B	32.18	―	―	―	―