What Does R Systems International's (NSE:RSYSTEMS) CEO Pay Reveal?

Satinder Rekhi became the CEO of R Systems International Limited (NSE:RSYSTEMS) in 2011, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for R Systems International.

See our latest analysis for R Systems International

Comparing R Systems International Limited's CEO Compensation With the industry

Our data indicates that R Systems International Limited has a market capitalization of ₹14b, and total annual CEO compensation was reported as ₹41m for the year to December 2019. That is, the compensation was roughly the same as last year. In particular, the salary of ₹29.9m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the same industry with market caps ranging from ₹7.4b to ₹30b, we found that the median CEO total compensation was ₹30m. This suggests that Satinder Rekhi is paid more than the median for the industry. Furthermore, Satinder Rekhi directly owns ₹1.7b worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. In R Systems International's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

R Systems International Limited's Growth

Over the past three years, R Systems International Limited has seen its earnings per share (EPS) grow by 17% per year. Its revenue is up 6.7% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has R Systems International Limited Been A Good Investment?

Boasting a total shareholder return of 199% over three years, R Systems International Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

As we noted earlier, R Systems International pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But EPS growth and shareholder returns have been top-notch for the past three years. As a result of the excellent all-round performance of the company, we believe CEO compensation is fair. Given the strong history of shareholder returns, the shareholders are probably very happy with Satinder's performance.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 2 warning signs (and 1 which shouldn't be ignored) in R Systems International we think you should know about.

Important note: R Systems International is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

If you’re looking to trade R Systems International, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.