A Quick Analysis On KEC International's (NSE:KEC) CEO Compensation

This article will reflect on the compensation paid to Vimal Kejriwal who has served as CEO of KEC International Limited (NSE:KEC) since 2015. This analysis will also assess whether KEC International pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for KEC International

How Does Total Compensation For Vimal Kejriwal Compare With Other Companies In The Industry?

According to our data, KEC International Limited has a market capitalization of ₹87b, and paid its CEO total annual compensation worth ₹68m over the year to March 2020. That's a notable increase of 10% on last year. Notably, the salary which is ₹49.5m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from ₹30b to ₹118b, the reported median CEO total compensation was ₹81m. So it looks like KEC International compensates Vimal Kejriwal in line with the median for the industry.

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. KEC International sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

KEC International Limited's Growth

KEC International Limited's earnings per share (EPS) grew 18% per year over the last three years. Its revenue is up 3.9% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has KEC International Limited Been A Good Investment?

KEC International Limited has served shareholders reasonably well, with a total return of 16% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

As we noted earlier, KEC International pays its CEO in line with similar-sized companies belonging to the same industry. But EPS growth over the last three years has been impressive, although the same cannot be said for shareholder returns. So considering these factors, we think the compensation is probably quite reasonable, but investor returns need a boost moving forward.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which is concerning) in KEC International we think you should know about.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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