How Much Does Sintercom India's (NSE:SINTERCOM) CEO Make?

Jignesh Raval is the CEO of Sintercom India Limited (NSE:SINTERCOM), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether Sintercom India pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Sintercom India

Comparing Sintercom India Limited's CEO Compensation With the industry

According to our data, Sintercom India Limited has a market capitalization of ₹2.2b, and paid its CEO total annual compensation worth ₹14m over the year to March 2020. Notably, that's a decrease of 22% over the year before. We note that the salary portion, which stands at ₹11.4m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations below ₹15b, reported a median total CEO compensation of ₹10m. Accordingly, our analysis reveals that Sintercom India Limited pays Jignesh Raval north of the industry median. Moreover, Jignesh Raval also holds ₹115m worth of Sintercom India stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 79% of total compensation represents salary, while the remainder of 21% is other remuneration. Sintercom India is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Sintercom India Limited's Growth

Sintercom India Limited has reduced its earnings per share by 114% a year over the last three years. Its revenue is down 37% over the previous year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Sintercom India Limited Been A Good Investment?

Sintercom India Limited has generated a total shareholder return of 26% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

As we touched on above, Sintercom India Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. This doesn't look great when you realize that the company has been suffering from negative EPS growth for the last three years. And shareholder returns are decent but not great. So we think more research is needed, but we don't think the CEO is underpaid.

CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 2 warning signs for Sintercom India (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

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. 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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