Liberty plans to buy tannery in Tamil Nadu

India's second largest domestic footwear company, Liberty Footwear, is planning to open a 5,000 pairs a day capacity unit in Andhra Pradesh or Karnataka. The company is also planning to buy a tannery in Tamil Nadu.

Liberty Footwear expects to record a 25 per cent to 30 per cent topline growth in 2004-05. The company reported a topline of Rs 200 crore for the financial year ending March 31, 2004.

Announcing the Liberty's plans for opening its own retail chain under the brand name, Revolutions, the group's executive director, Adarsh Gupta said, "The new unit in Karnataka or Andhra Pradesh will have a 5000 pair capacity per day and produce only non-leather footwear in the price range of Rs 300 and Rs 350 each. The opening of a new unit in the south will help us save Rs 25 per pair on logistics."

The company recently announced its plans to open a new unit in Uttaranchal with a capacity of 5000 pairs a day with an investment of Rs 5 crore initially.

Liberty at present has three units in Haryana with a aggregate capacity of 50,000 pairs a day. The average annual capacity utilisation for the group is now 75 per cent. "The new plant in Uttaranchal will be ready for commercial production by June this year," Gupta said.

The company plans to open 25 'Revolutions' shops in India over the next two years with a total spread of Rs 20 crore.

Additionally six retail outlets will be opened in the neighbouring countries over same time frame involving an investment of Rs 6 crore.

"Turnover from the retail outlets will touch Rs 75 crore by 2006-07 translating into a return on investment of eight to ten per cent," he said.

The shops outside India will be opened in Singapore, Dhaka, Karachi, Colombo, Kuala Lumpur and Dubai. Gupta was in Chennai to inaugurate the Revolution outlet in Chennai, with is the second in the country. The first outlet was opened in Mumbai last week.

"Each of these outlets will be spread over 2000 sq ft. The company invest Rs 75 lakh in each of these stores and we expect an average daily turnover of Rs 1 lakh from each of these stores," he said. All the retail outlets will be run by the company.

Meanwhile, Liberty Group has appointed a merchant banker to start talks with FMCG major, Hindustan Lever Ltd (HLL) to buy its leather business.

Adarsh Gupta said, "We are interested in HLL's Rs 80 crore leather business. We have not yet decided if we would buy the plant and machinery. The primary motivation is the large export portfolio this acquisition will add to our topline." Gupta refused to divulge the name of the merchant banking firm involved in the negotiations with HLL.