Is your foot in the right shoe? 4 footwear cos which gave stellar returns in 10 yrs

A pair of shoes of reporter Candido Rios, gunned down by unknown assailants, are seen over his coffin during his wake at his home in Hueyapan de Ocampo, in Veracruz state, Mexico, August 23, 2017. REUTERS/Victor Yanez - RC1FB53B71F0

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Footwear companies have consistently outperformed the benchmark index S&P BSE Sensex for some time now. Naturally, for investors who reposed faith in these companies, phenomenal returns have been the norm. Take, for example, Relaxo Footwear. The New Delhi-based company gave a share price return of over 7400 percent over the last 10 years. About Rs 15000 invested in it a decade ago is now worth over Rs 1 crore.

In order to understand these footwear companies' performance, Moneycontrol analysed their select fundamentals. Here are the findings.

High price to earning ratio
All stocks are trading with a very high premium to their five-year average P/E ratio.

Major shareholders (FIIs, MFs & promoters) position

Over the last six quarters, shareholder data of these four companies shows that mutual funds and foreign institutional investors have incrementally raised their stake in Relaxo Footwear. However, in Bata India institutional holding has fallen over the same period but in percentage terms they have a higher holding in the stock.

In all these four stocks, however, promoter holding since March 2016 has remained the same.

Topline and Bottomline growth: Relaxo in spotlight

These four listed companies’ topline growth remained muted in FY17. Relaxo saw a significant decline in sales growth as compared to its past five fiscal years but was able to post a positive bottomline growth.

However, Bata India and Liberty Shoes witnessed a de-growth in net profit for the second consecutive fiscal year.

In PAT margin performance, Relaxo Footwear proved to be the best among its peers as it continuously increased its margins each year from 4.41 percent in FY12  to 6.98 percent in FY17. But Bata India’s PAT margin has been shrinking over the years from 9.19 percent to 7.02 percent in same period.

Debt-Equity

Prima facie, Bata India’s dependence on borrowed funds was less amongst the four. In general, all footwear majors have been fundamentally healthy on this front, as apparent from a low debt-equity ratio of each company in each of the 5 years. There has been a steady decline in the debt-to-equity ratio of Mirza and Relaxo over a period of time.

Relaxo’s ROCE (return on capital employed), which was previously lower than Bata’s, has been the highest amongst its peers in the last 3 fiscals. Consequently, a similar trend is visible in return on networth.

Dividend

Amongst all four companies Bata India has given the highest dividend per share in all the last five fiscal years.

GST Benefit

The organised sector is likely to benefit from Goods and Services Tax rollout as smaller players will most likely wither away.

Follow @riteshpresswala