Dingyi Group Investment Limited's (HKG:508) CEO Will Probably Find It Hard To See A Huge Raise This Year

In the past three years, the share price of Dingyi Group Investment Limited (HKG:508) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 28 September 2022. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

See our latest analysis for Dingyi Group Investment

Comparing Dingyi Group Investment Limited's CEO Compensation With The Industry

Our data indicates that Dingyi Group Investment Limited has a market capitalization of HK$456m, and total annual CEO compensation was reported as HK$708k for the year to March 2022. Notably, that's an increase of 11% over the year before. We note that the salary portion, which stands at HK$650.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$960k. From this we gather that Xiaonong Su is paid around the median for CEOs in the industry. Moreover, Xiaonong Su also holds HK$909k worth of Dingyi Group Investment stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	HK$650k	HK$606k	92%
Other	HK$58k	HK$31k	8%
Total Compensation	HK$708k	HK$637k	100%

On an industry level, around 77% of total compensation represents salary and 23% is other remuneration. According to our research, Dingyi Group Investment has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Dingyi Group Investment Limited's Growth

Over the past three years, Dingyi Group Investment Limited has seen its earnings per share (EPS) grow by 59% per year. It saw its revenue drop 88% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. 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 Dingyi Group Investment Limited Been A Good Investment?

Few Dingyi Group Investment Limited shareholders would feel satisfied with the return of -77% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Dingyi Group Investment (of which 1 is potentially serious!) that you should know about in order to have a holistic understanding of the stock.

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.