Shareholders Will Probably Be Cautious Of Increasing Shanghai Realway Capital Assets Management Co., Ltd.'s (HKG:1835) CEO Compensation At The Moment

Key Insights

• Shanghai Realway Capital Assets Management to hold its Annual General Meeting on 14th of June
• CEO Ping Zhu's total compensation includes salary of CN¥1.09m
• The overall pay is 47% below the industry average
• Shanghai Realway Capital Assets Management's EPS declined by 57% over the past three years while total shareholder loss over the past three years was 48%

The disappointing performance at Shanghai Realway Capital Assets Management Co., Ltd. (HKG:1835) will make some shareholders rather disheartened. At the upcoming AGM on 14th of June, shareholders may have the opportunity to influence management to turn the performance around by voting on resolutions such as executive remuneration and other matters. The data we gathered below shows that CEO compensation looks acceptable for now.

See our latest analysis for Shanghai Realway Capital Assets Management

How Does Total Compensation For Ping Zhu Compare With Other Companies In The Industry?

At the time of writing, our data shows that Shanghai Realway Capital Assets Management Co., Ltd. has a market capitalization of HK$368m, and reported total annual CEO compensation of CN¥1.1m for the year to December 2023. Notably, that's an increase of 14% over the year before. Notably, the salary of CN¥1.1m is the entirety of the CEO compensation.

On comparing similar-sized companies in the Hong Kong Capital Markets industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥2.1m. Accordingly, Shanghai Realway Capital Assets Management pays its CEO under the industry median. Furthermore, Ping Zhu directly owns HK$259m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	CN¥1.1m	CN¥960k	100%
Other	-	-	-
Total Compensation	CN¥1.1m	CN¥960k	100%

On an industry level, around 83% of total compensation represents salary and 17% is other remuneration. Speaking on a company level, Shanghai Realway Capital Assets Management prefers to tread along a traditional path, disbursing all compensation through a salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Shanghai Realway Capital Assets Management Co., Ltd.'s Growth Numbers

Over the last three years, Shanghai Realway Capital Assets Management Co., Ltd. has shrunk its earnings per share by 57% per year. Its revenue is down 51% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Shanghai Realway Capital Assets Management Co., Ltd. Been A Good Investment?

With a total shareholder return of -48% over three years, Shanghai Realway Capital Assets Management Co., Ltd. shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Shanghai Realway Capital Assets Management pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Shanghai Realway Capital Assets Management (1 can't be ignored!) that you should be aware of before investing here.

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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.