It Looks Like The CEO Of Engineers India Limited (NSE:ENGINERSIN) May Be Underpaid Compared To Peers

Key Insights

• Engineers India will host its Annual General Meeting on 11th of September
• Salary of ₹5.72m is part of CEO Vartika Shukla's total remuneration
• Total compensation is 93% below industry average
• Engineers India's EPS grew by 28% over the past three years while total shareholder return over the past three years was 232%

The impressive results at Engineers India Limited (NSE:ENGINERSIN) recently will be great news for shareholders. At the upcoming AGM on 11th of September, 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. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

View our latest analysis for Engineers India

Comparing Engineers India Limited's CEO Compensation With The Industry

Our data indicates that Engineers India Limited has a market capitalization of ₹123b, and total annual CEO compensation was reported as ₹7.4m for the year to March 2024. Notably, that's an increase of 11% over the year before. Notably, the salary which is ₹5.72m, represents most of the total compensation being paid.

On comparing similar companies from the Indian Construction industry with market caps ranging from ₹84b to ₹269b, we found that the median CEO total compensation was ₹102m. That is to say, Vartika Shukla is paid under the industry median.

Component	2024	2023	Proportion (2024)
Salary	₹5.7m	₹5.3m	77%
Other	₹1.7m	₹1.4m	23%
Total Compensation	₹7.4m	₹6.7m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. It's interesting to note that Engineers India allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Engineers India Limited's Growth

Over the past three years, Engineers India Limited has seen its earnings per share (EPS) grow by 28% per year. Its revenue is down 7.4% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in 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 Engineers India Limited Been A Good Investment?

We think that the total shareholder return of 232%, over three years, would leave most Engineers India 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.

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. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Engineers India that investors should think about before committing capital to this stock.

Important note: Engineers India 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.