Here's Why Shareholders Should Examine Astral Limited's (NSE:ASTRAL) CEO Compensation Package More Closely

Key Insights

• Astral will host its Annual General Meeting on 25th of August
• Total pay for CEO Sandeep Engineer includes ₹76.2m salary
• The total compensation is 65% higher than the average for the industry
• Astral's three-year loss to shareholders was 13% while its EPS was down 1.1% over the past three years

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The results at Astral Limited (NSE:ASTRAL) have been quite disappointing recently and CEO Sandeep Engineer bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 25th of August. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. We present the case why we think CEO compensation is out of sync with company performance.

View our latest analysis for Astral

Comparing Astral Limited's CEO Compensation With The Industry

According to our data, Astral Limited has a market capitalization of ₹353b, and paid its CEO total annual compensation worth ₹152m over the year to March 2025. Notably, that's an increase of 8.9% over the year before. We note that the salary of ₹76.2m makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the Indian Building industry with market capitalizations ranging from ₹175b to ₹559b, the reported median CEO total compensation was ₹92m. This suggests that Sandeep Engineer is paid more than the median for the industry. What's more, Sandeep Engineer holds ₹111b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 97% of total compensation represents salary and 3% is other remuneration. It's interesting to note that Astral allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Astral Limited's Growth

Over the last three years, Astral Limited has shrunk its earnings per share by 1.1% per year. It achieved revenue growth of 1.2% over the last year.

Its a bit disappointing to see that the company has failed to grow its EPS. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Astral Limited Been A Good Investment?

Since shareholders would have lost about 13% over three years, some Astral Limited investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for Astral 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.