Liberty Shoes Ltd Falls to 52-Week Low Amid Continued Downtrend

Recent Price Movement and Market Context

On the day the new low was recorded, Liberty Shoes Ltd’s share price fell by 3.16%, touching an intraday low of Rs.259.75, a drop of 3.99% from the previous close. This decline extended a three-day losing streak, during which the stock has shed 6.34% in value. The stock’s performance notably lagged behind the Footwear sector, underperforming by 1.9% on the same day.

Technical indicators also highlight the bearish momentum, with Liberty Shoes trading below all key moving averages — the 5-day, 20-day, 50-day, 100-day, and 200-day averages — signalling sustained selling pressure. This contrasts with the broader market benchmark, the Sensex, which despite a negative opening and a fall of 536.89 points (-0.83%) to 83,485.20, remains only 3.2% below its 52-week high of 86,159.02. The Sensex’s 50-day moving average remains above its 200-day average, indicating a more stable medium-term trend compared to Liberty Shoes.

Financial Performance and Profitability Concerns

Liberty Shoes Ltd’s financial results have contributed to the stock’s subdued performance. The company reported a quarterly profit after tax (PAT) of Rs.1.96 crore, representing a decline of 42.1% compared to the previous four-quarter average. This sharp contraction in profitability has weighed on investor sentiment and valuation.

Interest expenses have also increased significantly, with a 25.97% rise over the nine-month period, reaching Rs.11.69 crore. This escalation in finance costs has further compressed operating profit margins, with the operating profit to interest ratio falling to a low of 3.79 times in the latest quarter. Such a ratio indicates tighter coverage of interest obligations by operating earnings, which can be a concern for financial stability.

Long-Term and Relative Performance

Over the past year, Liberty Shoes Ltd’s stock has delivered a negative return of 47.08%, a stark contrast to the Sensex’s positive 7.59% gain during the same period. This underperformance extends beyond the last year, with the stock lagging behind the BSE500 index over the last three years, one year, and three months, underscoring persistent challenges in maintaining competitive growth and market positioning.

Valuation Metrics and Market Perception

Despite the recent price decline, Liberty Shoes Ltd’s valuation metrics present a mixed picture. The company’s return on capital employed (ROCE) stands at 8.8%, which is considered very attractive relative to its sector peers. Additionally, the enterprise value to capital employed ratio is 1.6, indicating a valuation discount compared to historical averages within the footwear industry.

However, the stock’s current Mojo Score of 31.0 and a Mojo Grade of ‘Sell’ (upgraded from ‘Strong Sell’ on 11 Nov 2025) reflect cautious market sentiment. The Market Cap Grade is rated 4, suggesting moderate market capitalisation relative to peers. These ratings encapsulate the company’s financial performance and market positioning, signalling ongoing concerns despite some valuation appeal.

Shareholding and Sectoral Context

Promoters remain the majority shareholders of Liberty Shoes Ltd, maintaining significant control over the company’s strategic direction. The stock operates within the Footwear industry and sector, which has seen varied performance across companies, with Liberty Shoes notably underperforming its sector peers in recent periods.

Summary of Key Financial and Market Indicators

To summarise, Liberty Shoes Ltd’s stock has reached a new 52-week low of Rs.259.75, reflecting a sustained decline over recent months. The company’s quarterly PAT has contracted by over 40%, while interest expenses have risen sharply, impacting profitability ratios. The stock’s underperformance relative to the Sensex and its sector peers highlights ongoing challenges in growth and earnings stability.

Valuation metrics suggest the stock is trading at a discount, with an attractive ROCE and enterprise value to capital employed ratio. Nonetheless, the Mojo Grade of ‘Sell’ and a modest Mojo Score indicate that market confidence remains subdued. The stock’s technical indicators, including trading below all major moving averages, reinforce the current bearish trend.

Overall, Liberty Shoes Ltd’s recent price action and financial results illustrate a complex scenario of valuation appeal tempered by earnings pressure and market underperformance.

Upgrade at special rates, valid only for the next few days. Claim Your Special Rate →