Shareholders May Not Be So Generous With Isgec Heavy Engineering Limited's (NSE:ISGEC) CEO Compensation And Here's Why

Key Insights

• Isgec Heavy Engineering's Annual General Meeting to take place on 16th of September
• Total pay for CEO Aditya Puri includes ₹12.0m salary
• The total compensation is 252% higher than the average for the industry
• Isgec Heavy Engineering's total shareholder return over the past three years was 81% while its EPS grew by 39% over the past three years

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Under the guidance of CEO Aditya Puri, Isgec Heavy Engineering Limited (NSE:ISGEC) has performed reasonably well recently. As shareholders go into the upcoming AGM on 16th of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Isgec Heavy Engineering

Comparing Isgec Heavy Engineering Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Isgec Heavy Engineering Limited has a market capitalization of ₹73b, and reported total annual CEO compensation of ₹115m for the year to March 2025. That's a notable increase of 36% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹12m.

In comparison with other companies in the Indian Machinery industry with market capitalizations ranging from ₹35b to ₹141b, the reported median CEO total compensation was ₹33m. Hence, we can conclude that Aditya Puri is remunerated higher than the industry median. Furthermore, Aditya Puri directly owns ₹4.5b worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 98% of total compensation represents salary and 2% is other remuneration. In Isgec Heavy Engineering's case, non-salary compensation represents a greater slice of total remuneration, 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.

Isgec Heavy Engineering Limited's Growth

Isgec Heavy Engineering Limited has seen its earnings per share (EPS) increase by 39% a year over the past three years. In the last year, its revenue is down 2.3%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. 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 Isgec Heavy Engineering Limited Been A Good Investment?

We think that the total shareholder return of 81%, over three years, would leave most Isgec Heavy Engineering 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...

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, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

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 Isgec Heavy Engineering that you should be aware of before investing.

Important note: Isgec Heavy Engineering 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.