In 2013 Pulkit Seth was appointed CEO of Pearl Global Industries Limited (NSE:PGIL). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Pulkit Seth’s Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Pearl Global Industries Limited has a market cap of ₹2.7b, and reported total annual CEO compensation of ₹12m for the year to March 2019. It is worth noting that the CEO compensation consists almost entirely of the salary, worth ₹12m. We took a group of companies with market capitalizations below ₹15b, and calculated the median CEO total compensation to be ₹3.6m.
Thus we can conclude that Pulkit Seth receives more in total compensation than the median of a group of companies in the same market, and of similar size to Pearl Global Industries Limited. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Pearl Global Industries has changed from year to year.
Is Pearl Global Industries Limited Growing?
On average over the last three years, Pearl Global Industries Limited has grown earnings per share (EPS) by 28% each year (using a line of best fit). Its revenue is down 1.3% over last year.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. We don’t have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Pearl Global Industries Limited Been A Good Investment?
With a three year total loss of 9.8%, Pearl Global Industries Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared total CEO remuneration at Pearl Global Industries Limited with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. On the other hand returns to investors over the same period have probably disappointed many. While EPS is positive, we’d say shareholders would want better returns before the CEO is paid much more. CEO compensation is an important area to keep your eyes on, but we’ve also identified 5 warning signs for Pearl Global Industries (1 shouldn’t be ignored!) that you should be aware of before investing here.
If you want to buy a stock that is better than Pearl Global Industries, this free list of high return, low debt companies is a great place to look.
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