Increases to Manav Infra Projects Limited's (NSE:MANAV) CEO Compensation Might Cool off for now

Despite Manav Infra Projects Limited's (NSE:MANAV) share price growing positively in the past few years, the per-share earnings growth has not grown to investors' expectations, suggesting that there could be other factors at play driving the share price. The upcoming AGM on 29 September 2022 may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. They will be able to influence managerial decisions through the exercise of their voting power on resolutions, such as CEO remuneration and other matters, which may influence future company prospects. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

View our latest analysis for Manav Infra Projects

How Does Total Compensation For Mahendra Raju Compare With Other Companies In The Industry?

At the time of writing, our data shows that Manav Infra Projects Limited has a market capitalization of ₹41m, and reported total annual CEO compensation of ₹4.8m for the year to March 2022. This was the same as last year. Notably, the salary which is ₹2.40m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under ₹16b, the reported median total CEO compensation was ₹3.1m. Accordingly, our analysis reveals that Manav Infra Projects Limited pays Mahendra Raju north of the industry median. Moreover, Mahendra Raju also holds ₹25m worth of Manav Infra Projects stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	₹2.4m	₹3.0m	50%
Other	₹2.4m	₹1.8m	50%
Total Compensation	₹4.8m	₹4.8m	100%

On an industry level, around 97% of total compensation represents salary and 3% is other remuneration. Manav Infra Projects pays a modest slice of remuneration through salary, as compared to the broader industry.

Manav Infra Projects Limited's Growth

Manav Infra Projects Limited has reduced its earnings per share by 46% a year over the last three years. Its revenue is up 6.9% over the last year.

Overall this is not a very positive result for shareholders. The fairly low revenue growth fails to impress given that the EPS is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Manav Infra Projects Limited Been A Good Investment?

Manav Infra Projects Limited has generated a total shareholder return of 13% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Shareholder returns, while positive, should be looked at along with earnings, which have not grown at all recently. This makes us think the share price momentum may slow in the future. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 5 warning signs for Manav Infra Projects (of which 4 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Important note: Manav Infra Projects 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.