Shareholders May Not Be So Generous With L.G. Balakrishnan & Bros Limited's (NSE:LGBBROSLTD) CEO Compensation And Here's Why

Key Insights

• L.G. Balakrishnan & Bros will host its Annual General Meeting on 21st of August
• CEO Palanisamy Prabakaran's total compensation includes salary of ₹10.6m
• The total compensation is 83% higher than the average for the industry
• Over the past three years, L.G. Balakrishnan & Bros' EPS grew by 3.4% and over the past three years, the total shareholder return was 85%

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CEO Palanisamy Prabakaran has done a decent job of delivering relatively good performance at L.G. Balakrishnan & Bros Limited (NSE:LGBBROSLTD) recently. As shareholders go into the upcoming AGM on 21st of August, 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.

See our latest analysis for L.G. Balakrishnan & Bros

Comparing L.G. Balakrishnan & Bros Limited's CEO Compensation With The Industry

Our data indicates that L.G. Balakrishnan & Bros Limited has a market capitalization of ₹39b, and total annual CEO compensation was reported as ₹34m for the year to March 2025. That's a modest increase of 4.3% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹11m.

On comparing similar companies from the Indian Machinery industry with market caps ranging from ₹18b to ₹70b, we found that the median CEO total compensation was ₹19m. Accordingly, our analysis reveals that L.G. Balakrishnan & Bros Limited pays Palanisamy Prabakaran north of the industry median.

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. L.G. Balakrishnan & Bros sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

L.G. Balakrishnan & Bros Limited's Growth

Over the past three years, L.G. Balakrishnan & Bros Limited has seen its earnings per share (EPS) grow by 3.4% per year. Its revenue is up 12% over the last year.

We think the revenue growth is good. And the modest growth in EPS isn't bad, either. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. 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 L.G. Balakrishnan & Bros Limited Been A Good Investment?

Most shareholders would probably be pleased with L.G. Balakrishnan & Bros Limited for providing a total return of 85% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same 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, 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 L.G. Balakrishnan & Bros that investors should think about before committing capital to this stock.

Switching gears from L.G. Balakrishnan & Bros, 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.