Graphite India Limited's (NSE:GRAPHITE) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Graphite India's Annual General Meeting to take place on 31st of July
• Total pay for CEO Ashutosh Dixit includes ₹6.00m salary
• Total compensation is 50% below industry average
• Over the past three years, Graphite India's EPS grew by 45% and over the past three years, the total loss to shareholders 18%

Performance at Graphite India Limited (NSE:GRAPHITE) has been rather uninspiring recently and shareholders may be wondering how CEO Ashutosh Dixit plans to fix this. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 31st of July. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.

View our latest analysis for Graphite India

How Does Total Compensation For Ashutosh Dixit Compare With Other Companies In The Industry?

Our data indicates that Graphite India Limited has a market capitalization of ₹102b, and total annual CEO compensation was reported as ₹20m for the year to March 2024. That's a fairly small increase of 7.9% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹6.0m.

On examining similar-sized companies in the Indian Electrical industry with market capitalizations between ₹84b and ₹268b, we discovered that the median CEO total compensation of that group was ₹40m. In other words, Graphite India pays its CEO lower than the industry median.

Component	2024	2023	Proportion (2024)
Salary	₹6.0m	₹5.5m	30%
Other	₹14m	₹13m	70%
Total Compensation	₹20m	₹18m	100%

On an industry level, roughly 89% of total compensation represents salary and 11% is other remuneration. It's interesting to note that Graphite India allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Graphite India Limited's Growth Numbers

Graphite India Limited's earnings per share (EPS) grew 45% per year over the last three years. It saw its revenue drop 7.3% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Graphite India Limited Been A Good Investment?

Since shareholders would have lost about 18% over three years, some Graphite India Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

The fact that shareholders are sitting on a loss is certainly disheartening. This diverges with the robust growth in EPS, suggesting that there is a large discrepancy between share price and fundamentals. A key question may be why the fundamentals have not yet been reflected into the share price. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.

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 2 warning signs for Graphite India that you should be aware of before investing.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com