Why is Liberty Shoes falling/rising?

As of 04-Sep, Liberty Shoes Ltd is experiencing a price increase, currently at Rs 342.90, reflecting a rise of Rs 5.1 or 1.51%. The stock has shown a strong performance over the last week, gaining 11.33%, despite underperforming its sector by 0.34% today. It opened with a gain of 3.02% and reached an intraday high of Rs 353.9. However, the stock's long-term performance remains concerning, with a year-to-date decline of 28.70% and a one-year drop of 25.29%. Factors contributing to this recent rise include a very attractive valuation indicated by a ROCE of 9.8 and trading at a discount compared to peers. Nonetheless, the company faces challenges such as a high Debt to EBITDA ratio of 2.54 times and declining profitability, which may hinder its long-term growth prospects.
In the broader market context, Liberty Shoes has significantly outperformed the Sensex in the short term, with a 1-week return of 11.33% compared to the Sensex's 0.80%. However, the stock's poor performance over the past year, where it fell by 25.29% against the BSE500's decline of only 4.38%, indicates a lack of investor confidence. The low participation from domestic mutual funds, holding 0% of the company, suggests that institutional investors may be wary of the stock's valuation or business fundamentals. Overall, while the recent price increase may reflect short-term trading momentum, underlying financial challenges could limit sustainable growth.