Is Future Enterprises Limited’s (NSE:FELDVR) CEO Pay Fair?

In 2016 Vijay Biyani was appointed CEO of Future Enterprises Limited (NSE:FELDVR). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Future Enterprises

How Does Vijay Biyani’s Compensation Compare With Similar Sized Companies?

Our data indicates that Future Enterprises Limited is worth ₹22b, and total annual CEO compensation is ₹27m. We note that’s an increase of 40% above last year. We examined companies with market caps from ₹14b to ₹57b, and discovered that the median CEO compensation of that group was ₹22m.

So Vijay Biyani receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.

You can see a visual representation of the CEO compensation at Future Enterprises, below.

NSEI:FELDVR CEO Compensation November 21st 18
NSEI:FELDVR CEO Compensation November 21st 18

Is Future Enterprises Limited Growing?

On average over the last three years, Future Enterprises Limited has shrunk earnings per share by 91% each year. In the last year, its revenue is up 14%.

Sadly for shareholders, earnings per share are actually down, over three years. And while it’s good to see some good revenue growth recently, the growth isn’t really fast enough for me to put aside my concerns around earnings. 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 might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Future Enterprises Limited Been A Good Investment?

Since shareholders would have lost about 60% over three years, some Future Enterprises Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.

In Summary…

Remuneration for Vijay Biyani is close enough to the median pay for a CEO of a similar sized company .

After looking at EPS and total shareholder returns, it’s certainly hard to argue the company has performed well, since both metrics are down. This doesn’t look great when you consider CEO remuneration is up on last year. Few would argue that it’s wise for the company to pay any more, before returns improve.

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.