Liberty Shoes, a footwear manufacturer is broadening its product range from need based shoes to lifestyle shoes. The company is concentrating on the fashion conscious consumer by introducing stylish leather and non leather shoes. This strategy to move up the value chain has been a conscious effort to increase the average realizations. The company has created a range of 10 brands to exclusively cater to specific target groups. Liberty Shoes is moving up the value chain by catering to a broader income group

In December 2006, the company commenced operations at 2 new plants, one in Himachal Pradesh and the other in Uttar Pradesh; both of which are tax exempt areas. The total capacity of the company, post expansion stands at 10.5 million pairs per annum as against 6.4 million pairs.

The company's capacity utilization in FY07 has been low at around 63% on account of the labour unrest that it faced. Normally the company operates at 100% capacity utilization. Post expansion, the company is expected to operate at higher capacity utilizations

The company intends to form JV's with component manufacturers and to shift to assembly line of production to increase productivity. Liberty Shoes wants to have presence in all shoe segments with special thrust on the institutional segment. This includes safety shoes for factory workers and shoes for defence forces. In October 2006 the company received an order of Rs 1 billion from German footwear manufacturer Van Eten for safety shoes. This order shall be executed within 3 years.

To increase presence in the lifestyle market, Liberty has launched retail stores named "Revolutions" in high end malls across the country. The company currently operates 21 standalone “Revolutions” stores 23 shop in shops.

In September 2005, Liberty Shoes and Pantaloon Retail entered in to a joint venture for the business of footwear retailing. The JV brings together Liberty Shoes expertise in the shoe business along with Pantaloon's expertise in retailing. The JV operates large format shoe stores ranging between 8,000-10,000 square feet in the value and lifestyle format. These stores sell a wide range of footwear brands (Indian and foreign) along with Liberty brands. As on 31st March, 2007, the JV has 14 stores under operations.

As on 31st March 2007, the company reported sales of Rs 220 crore, operating margins of 13.8% and net profit of Rs 14.9 crore. The company’s EPS was Rs 8.8. We expect earnings growth of 35% over FY08 and FY09 on account of increase in capacities as well as increase in average realizations.