We Take A Look At Why Talbros Automotive Components Limited's (NSE:TALBROAUTO) CEO Compensation Is Well Earned

Key Insights

• Talbros Automotive Components to hold its Annual General Meeting on 25th of September
• Salary of ₹10.2m is part of CEO Umesh Talwar's total remuneration
• The total compensation is similar to the average for the industry
• Talbros Automotive Components' total shareholder return over the past three years was 515% while its EPS grew by 25% over the past three years

The performance at Talbros Automotive Components Limited (NSE:TALBROAUTO) has been quite strong recently and CEO Umesh Talwar has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 25th of September. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

View our latest analysis for Talbros Automotive Components

Comparing Talbros Automotive Components Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Talbros Automotive Components Limited has a market capitalization of ₹21b, and reported total annual CEO compensation of ₹29m for the year to March 2024. That's a notable increase of 65% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹10m.

For comparison, other companies in the Indian Auto Components industry with market capitalizations ranging between ₹8.4b and ₹33b had a median total CEO compensation of ₹28m. This suggests that Talbros Automotive Components remunerates its CEO largely in line with the industry average. Moreover, Umesh Talwar also holds ₹316m worth of Talbros Automotive Components stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	₹10m	₹9.1m	35%
Other	₹19m	₹8.4m	65%
Total Compensation	₹29m	₹17m	100%

On an industry level, roughly 76% of total compensation represents salary and 24% is other remuneration. Talbros Automotive Components sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Talbros Automotive Components Limited's Growth Numbers

Over the past three years, Talbros Automotive Components Limited has seen its earnings per share (EPS) grow by 25% per year. Its revenue is up 18% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 Talbros Automotive Components Limited Been A Good Investment?

Most shareholders would probably be pleased with Talbros Automotive Components Limited for providing a total return of 515% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

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've identified 1 warning sign for Talbros Automotive Components that investors should be aware of in a dynamic business environment.

Important note: Talbros Automotive Components 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.