Why We Think Shareholders May Be Considering Bumping Up Astral Limited's (NSE:ASTRAL) CEO Compensation

Shareholders will be pleased by the impressive results for Astral Limited (NSE:ASTRAL) recently and CEO Sandeep Engineer has played a key role. At the upcoming AGM on 31 August 2021, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

Check out our latest analysis for Astral

How Does Total Compensation For Sandeep Engineer Compare With Other Companies In The Industry?

According to our data, Astral Limited has a market capitalization of ₹396b, and paid its CEO total annual compensation worth ₹85m over the year to March 2021. Notably, that's an increase of 42% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹41m.

On examining similar-sized companies in the industry with market capitalizations between ₹297b and ₹890b, we discovered that the median CEO total compensation of that group was ₹376m. Accordingly, Astral pays its CEO under the industry median. Moreover, Sandeep Engineer also holds ₹124b worth of Astral stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	₹41m	₹35m	49%
Other	₹44m	₹25m	51%
Total Compensation	₹85m	₹60m	100%

Speaking on an industry level, nearly 100% of total compensation represents salary, while the remainder of 0.26645% 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 non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Astral Limited's Growth Numbers

Astral Limited has seen its earnings per share (EPS) increase by 34% a year over the past three years. It achieved revenue growth of 46% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Astral Limited Been A Good Investment?

We think that the total shareholder return of 193%, over three years, would leave most Astral Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in 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.

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 Astral that investors should be aware of in a dynamic business environment.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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