Sajan Bansal has been the CEO of Skipper Limited (NSE:SKIPPER) since 2007, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Skipper.
How Does Total Compensation For Sajan Bansal Compare With Other Companies In The Industry?
Our data indicates that Skipper Limited has a market capitalization of ₹6.2b, and total annual CEO compensation was reported as ₹14m for the year to March 2020. That's a notable decrease of 20% on last year. Notably, the salary of ₹14m is the entirety of the CEO compensation.
In comparison with other companies in the industry with market capitalizations under ₹15b, the reported median total CEO compensation was ₹5.1m. Hence, we can conclude that Sajan Bansal is remunerated higher than the industry median. Furthermore, Sajan Bansal directly owns ₹1.3b worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, it's fascinating to see that all of total compensation represents salary and non-salary benefits do not factor into the equation at all. Speaking on a company level, Skipper prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Skipper Limited's Growth
Skipper Limited has reduced its earnings per share by 32% a year over the last three years. In the last year, its revenue is down 10%.
Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Skipper Limited Been A Good Investment?
With a three year total loss of 77% for the shareholders, Skipper Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.
Skipper pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As we touched on above, Skipper Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Disappointingly, share price gains over the last three years have failed to materialize. Add to that declining EPS growth, and you have the perfect recipe for shareholder irritation. Considering such poor performance, we think shareholders might be concerned if the CEO's compensation were to grow.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 5 warning signs for Skipper (of which 2 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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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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