It Looks Like Shareholders Would Probably Approve Mazagon Dock Shipbuilders Limited's (NSE:MAZDOCK) CEO Compensation Package

Key Insights

• Mazagon Dock Shipbuilders will host its Annual General Meeting on 26th of September
• Salary of ₹11.5m is part of CEO Sanjeev Singhal's total remuneration
• The overall pay is comparable to the industry average
• Mazagon Dock Shipbuilders' total shareholder return over the past three years was 1,595% while its EPS grew by 57% over the past three years

The performance at Mazagon Dock Shipbuilders Limited (NSE:MAZDOCK) has been quite strong recently and CEO Sanjeev Singhal has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 26th of September. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

See our latest analysis for Mazagon Dock Shipbuilders

Comparing Mazagon Dock Shipbuilders Limited's CEO Compensation With The Industry

Our data indicates that Mazagon Dock Shipbuilders Limited has a market capitalization of ₹819b, and total annual CEO compensation was reported as ₹13m for the year to March 2024. We note that's an increase of 62% above last year. We note that the salary portion, which stands at ₹11.5m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Indian Aerospace & Defense industry with market capitalizations above ₹669b, reported a median total CEO compensation of ₹10m. This suggests that Mazagon Dock Shipbuilders remunerates its CEO largely in line with the industry average.

Component	2024	2023	Proportion (2024)
Salary	₹11m	₹7.1m	92%
Other	₹1.1m	₹623k	8%
Total Compensation	₹13m	₹7.7m	100%

Talking in terms of the industry, salary represented approximately 92% of total compensation out of all the companies we analyzed, while other remuneration made up 8% of the pie. Although there is a difference in how total compensation is set, Mazagon Dock Shipbuilders more or less reflects the market in terms of setting the salary. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Mazagon Dock Shipbuilders Limited's Growth

Over the past three years, Mazagon Dock Shipbuilders Limited has seen its earnings per share (EPS) grow by 57% per year. In the last year, its revenue is up 24%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Mazagon Dock Shipbuilders Limited Been A Good Investment?

We think that the total shareholder return of 1,595%, over three years, would leave most Mazagon Dock Shipbuilders Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

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 3 warning signs for Mazagon Dock Shipbuilders (of which 2 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

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.