What We Learned About Sharda Cropchem's (NSE:SHARDACROP) CEO Pay

Ramprakash Bubna is the CEO of Sharda Cropchem Limited (NSE:SHARDACROP), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Sharda Cropchem.

View our latest analysis for Sharda Cropchem

How Does Total Compensation For Ramprakash Bubna Compare With Other Companies In The Industry?

According to our data, Sharda Cropchem Limited has a market capitalization of ₹24b, and paid its CEO total annual compensation worth ₹44m over the year to March 2020. That's a slight decrease of 6.8% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹18m.

In comparison with other companies in the industry with market capitalizations ranging from ₹15b to ₹59b, the reported median CEO total compensation was ₹28m. Hence, we can conclude that Ramprakash Bubna is remunerated higher than the industry median. Furthermore, Ramprakash Bubna directly owns ₹3.7b worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 88% of total compensation represents salary and 12% is other remuneration. Sharda Cropchem pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Sharda Cropchem Limited's Growth

Over the last three years, Sharda Cropchem Limited has shrunk its earnings per share by 4.1% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

Overall this is not a very positive result for shareholders. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Sharda Cropchem Limited Been A Good Investment?

Given the total shareholder loss of 40% over three years, many shareholders in Sharda Cropchem Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As previously discussed, Ramprakash is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Unfortunately, this doesn't look great when you see shareholder returns have been negative over the last three years. To make matters worse, EPS growth has also been negative during this period. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Sharda Cropchem that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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