Shareholders May Not Be So Generous With KEI Industries Limited's (NSE:KEI) CEO Compensation And Here's Why

Key Insights

• KEI Industries will host its Annual General Meeting on 11th of September
• CEO Anil Gupta's total compensation includes salary of ₹46.2m
• The overall pay is 885% above the industry average
• KEI Industries' total shareholder return over the past three years was 446% while its EPS grew by 26% over the past three years

Performance at KEI Industries Limited (NSE:KEI) has been reasonably good and CEO Anil Gupta has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 11th of September. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for KEI Industries

Comparing KEI Industries Limited's CEO Compensation With The Industry

Our data indicates that KEI Industries Limited has a market capitalization of ₹405b, and total annual CEO compensation was reported as ₹412m for the year to March 2024. That's a notable increase of 21% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹46m.

On comparing similar companies from the Indian Electrical industry with market caps ranging from ₹336b to ₹1.0t, we found that the median CEO total compensation was ₹42m. Accordingly, our analysis reveals that KEI Industries Limited pays Anil Gupta north of the industry median. Furthermore, Anil Gupta directly owns ₹70b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹46m	₹46m	11%
Other	₹366m	₹293m	89%
Total Compensation	₹412m	₹339m	100%

On an industry level, roughly 83% of total compensation represents salary and 17% is other remuneration. In KEI Industries' 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.

A Look at KEI Industries Limited's Growth Numbers

Over the past three years, KEI Industries Limited has seen its earnings per share (EPS) grow by 26% per year. In the last year, its revenue is up 18%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 KEI Industries Limited Been A Good Investment?

Most shareholders would probably be pleased with KEI Industries Limited for providing a total return of 446% 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...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus 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.

So you may want to check if insiders are buying KEI Industries shares with their own money (free access).

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.