Increases to CEO Compensation Might Be Put On Hold For Now at Honda India Power Products Limited (NSE:HONDAPOWER)

CEO Takahiro Ueda has done a decent job of delivering relatively good performance at Honda India Power Products Limited (NSE:HONDAPOWER) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 26 September 2022. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Honda India Power Products

Comparing Honda India Power Products Limited's CEO Compensation With The Industry

According to our data, Honda India Power Products Limited has a market capitalization of ₹15b, and paid its CEO total annual compensation worth ₹25m over the year to March 2022. That's a fairly small increase of 3.5% over the previous year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹900k.

In comparison with other companies in the industry with market capitalizations ranging from ₹8.0b to ₹32b, the reported median CEO total compensation was ₹15m. Hence, we can conclude that Takahiro Ueda is remunerated higher than the industry median.

Component	2022	2021	Proportion (2022)
Salary	₹900k	₹900k	4%
Other	₹24m	₹24m	96%
Total Compensation	₹25m	₹25m	100%

Talking in terms of the industry, salary represented approximately 91% of total compensation out of all the companies we analyzed, while other remuneration made up 9% of the pie. Investors may find it interesting that Honda India Power Products paid a marginal salary to Takahiro Ueda, over the past year, focusing on non-salary compensation instead. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Honda India Power Products Limited's Growth Numbers

Earnings per share at Honda India Power Products Limited are much the same as they were three years ago, albeit with slightly higher. Revenue was pretty flat on last year.

We would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see a modest EPS growth at least. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Honda India Power Products Limited Been A Good Investment?

Most shareholders would probably be pleased with Honda India Power Products Limited for providing a total return of 37% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Honda India Power Products prefers rewarding its CEO through non-salary benefits. The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Honda India Power Products that you should be aware of before investing.

Switching gears from Honda India Power Products, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.