We Think Shareholders Will Probably Be Generous With G N A Axles Limited's (NSE:GNA) CEO Compensation

Key Insights

• G N A Axles to hold its Annual General Meeting on 29th of September
• CEO Ranbir Seehra's total compensation includes salary of ₹31.4m
• Total compensation is similar to the industry average
• G N A Axles' EPS grew by 70% over the past three years while total shareholder return over the past three years was 333%

The performance at G N A Axles Limited (NSE:GNA) has been quite strong recently and CEO Ranbir Seehra has played a role in it. Coming up to the next AGM on 29th of September, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for G N A Axles

Comparing G N A Axles Limited's CEO Compensation With The Industry

At the time of writing, our data shows that G N A Axles Limited has a market capitalization of ₹20b, and reported total annual CEO compensation of ₹31m for the year to March 2023. That's a notable increase of 20% on last year. Notably, the salary of ₹31m is the entirety of the CEO compensation.

For comparison, other companies in the Indian Auto Components industry with market capitalizations ranging between ₹8.3b and ₹33b had a median total CEO compensation of ₹27m. From this we gather that Ranbir Seehra is paid around the median for CEOs in the industry. What's more, Ranbir Seehra holds ₹3.0b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	₹31m	₹26m	100%
Other	-	-	-
Total Compensation	₹31m	₹26m	100%

On an industry level, roughly 76% of total compensation represents salary and 24% is other remuneration. Speaking on a company level, G N A Axles 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 G N A Axles Limited's Growth Numbers

G N A Axles Limited's earnings per share (EPS) grew 70% per year over the last three years. It achieved revenue growth of 20% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has G N A Axles Limited Been A Good Investment?

Most shareholders would probably be pleased with G N A Axles Limited for providing a total return of 333% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

G N A Axles rewards its CEO solely through a salary, ignoring non-salary benefits completely. Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for G N A Axles that investors should look into moving forward.

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.