It's Unlikely That Sandhar Technologies Limited's (NSE:SANDHAR) CEO Will See A Huge Pay Rise This Year

As many shareholders of Sandhar Technologies Limited (NSE:SANDHAR) will be aware, they have not made a gain on their investment in the past three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 23 September 2021. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

Check out our latest analysis for Sandhar Technologies

How Does Total Compensation For Jayant Davar Compare With Other Companies In The Industry?

At the time of writing, our data shows that Sandhar Technologies Limited has a market capitalization of ₹18b, and reported total annual CEO compensation of ₹46m for the year to March 2021. We note that's a small decrease of 3.6% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹10.0m.

In comparison with other companies in the industry with market capitalizations ranging from ₹7.4b to ₹29b, the reported median CEO total compensation was ₹20m. Hence, we can conclude that Jayant Davar is remunerated higher than the industry median. Furthermore, Jayant Davar directly owns ₹10b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2021	2020	Proportion (2021)
Salary	₹10.0m	₹13m	22%
Other	₹36m	₹34m	78%
Total Compensation	₹46m	₹48m	100%

On an industry level, roughly 72% of total compensation represents salary and 28% is other remuneration. Sandhar Technologies pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Sandhar Technologies Limited's Growth

Sandhar Technologies Limited has seen its earnings per share (EPS) increase by 4.7% a year over the past three years. It achieved revenue growth of 41% over the last year.

It's hard to interpret the strong revenue growth as anything other than a positive. Combined with modest EPS growth, we get a good impression of the company. We wouldn't say this is necessarily top notch growth, but it is certainly promising. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Sandhar Technologies Limited Been A Good Investment?

With a three year total loss of 10% for the shareholders, Sandhar Technologies Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. 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.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for Sandhar Technologies that investors should be aware of in a dynamic business environment.

Important note: Sandhar Technologies is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.
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