How Does Eris Lifesciences' (NSE:ERIS) CEO Salary Compare to Peers?

Amit Bakshi is the CEO of Eris Lifesciences Limited (NSE:ERIS), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Eris Lifesciences

How Does Total Compensation For Amit Bakshi Compare With Other Companies In The Industry?

Our data indicates that Eris Lifesciences Limited has a market capitalization of ₹73b, and total annual CEO compensation was reported as ₹49m for the year to March 2020. This means that the compensation hasn't changed much from last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹18m.

On examining similar-sized companies in the industry with market capitalizations between ₹29b and ₹118b, we discovered that the median CEO total compensation of that group was ₹50m. This suggests that Eris Lifesciences remunerates its CEO largely in line with the industry average. What's more, Amit Bakshi holds ₹29b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 99% of total compensation represents salary and 1.3% is other remuneration. Eris Lifesciences sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Eris Lifesciences Limited's Growth Numbers

Eris Lifesciences Limited has seen its earnings per share (EPS) increase by 6.6% a year over the past three years. It achieved revenue growth of 8.3% over the last year.

We're not particularly impressed by the revenue growth, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Eris Lifesciences Limited Been A Good Investment?

Since shareholders would have lost about 5.6% over three years, some Eris Lifesciences Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As we noted earlier, Eris Lifesciences pays its CEO in line with similar-sized companies belonging to the same industry. Meanwhile, Eris Lifesciences is suffering from adverse shareholder returns and althoughEPS have grown over the past three years, they have not been extraordinary. Although we wouldn't say CEO compensation is exceptionally high, it isn't very low either. Shareholders might want to see substantial improvements in returns before agreeing that Amit deserves a raise.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Eris Lifesciences that you should be aware of before investing.

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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