Here's Why Shareholders May Want To Be Cautious With Increasing Apollo Tyres Limited's (NSE:APOLLOTYRE) CEO Pay Packet

Key Insights

• Apollo Tyres' Annual General Meeting to take place on 31st of July
• Salary of ₹49.3m is part of CEO Neeraj Kanwar's total remuneration
• Total compensation is 510% above industry average
• Apollo Tyres' EPS grew by 21% over the past three years while total shareholder return over the past three years was 117%

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Performance at Apollo Tyres Limited (NSE:APOLLOTYRE) has been reasonably good and CEO Neeraj Kanwar has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 31st of July, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Apollo Tyres

How Does Total Compensation For Neeraj Kanwar Compare With Other Companies In The Industry?

Our data indicates that Apollo Tyres Limited has a market capitalization of ₹292b, and total annual CEO compensation was reported as ₹400m for the year to March 2025. We note that's a decrease of 38% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹49m.

In comparison with other companies in the Indian Auto Components industry with market capitalizations ranging from ₹173b to ₹553b, the reported median CEO total compensation was ₹66m. Hence, we can conclude that Neeraj Kanwar is remunerated higher than the industry median. Moreover, Neeraj Kanwar also holds ₹308m worth of Apollo Tyres stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 78% of total compensation represents salary and 22% is other remuneration. It's interesting to note that Apollo Tyres allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Apollo Tyres Limited's Growth Numbers

Over the past three years, Apollo Tyres Limited has seen its earnings per share (EPS) grow by 21% per year. Its revenue is up 2.9% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Apollo Tyres Limited Been A Good Investment?

We think that the total shareholder return of 117%, over three years, would leave most Apollo Tyres Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Apollo Tyres that investors should be aware of in a dynamic business environment.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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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.