Does KSB's (NSE:KSB) CEO Salary Compare Well With Industry Peers?

Rajeev Jain became the CEO of KSB Limited (NSE:KSB) in 2016, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for KSB

How Does Total Compensation For Rajeev Jain Compare With Other Companies In The Industry?

Our data indicates that KSB Limited has a market capitalization of ₹18b, and total annual CEO compensation was reported as ₹41m for the year to December 2019. That's a notable increase of 25% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹12m.

On comparing similar companies from the same industry with market caps ranging from ₹7.4b to ₹30b, we found that the median CEO total compensation was ₹22m. This suggests that Rajeev Jain is paid more than the median for the industry.

Talking in terms of the industry, salary represented approximately 89% of total compensation out of all the companies we analyzed, while other remuneration made up 11% of the pie. KSB pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

KSB Limited's Growth

KSB Limited's earnings per share (EPS) grew 10% per year over the last three years. Its revenue is down 9.8% over the previous year.

Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has KSB Limited Been A Good Investment?

Given the total shareholder loss of 36% over three years, many shareholders in KSB Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As previously discussed, Rajeev is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, we must not forget that the EPS growth has been very strong, but it's disappointing to see negative shareholder returns over the same period. Although we'd stop short of calling it inappropriate, we think Rajeev is earning a very handsome sum.

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 KSB that investors should think about before committing capital to this stock.

Switching gears from KSB, 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. 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.
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