Here's What We Think About Walchandnagar Industries Limited's (NSE:WALCHANNAG) CEO Pay

G. Pillai has been the CEO of Walchandnagar Industries Limited (NSE:WALCHANNAG) since 2012. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Walchandnagar Industries

How Does G. Pillai's Compensation Compare With Similar Sized Companies?

According to our data, Walchandnagar Industries Limited has a market capitalization of ₹2.6b, and paid its CEO total annual compensation worth ₹10m over the year to March 2019. We think total compensation is more important but we note that the CEO salary is lower, at ₹8.7m. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹3.5m.

Thus we can conclude that G. Pillai receives more in total compensation than the median of a group of companies in the same market, and of similar size to Walchandnagar Industries Limited. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Walchandnagar Industries has changed over time.

Is Walchandnagar Industries Limited Growing?

On average over the last three years, Walchandnagar Industries Limited has grown earnings per share (EPS) by 58% each year (using a line of best fit). Its revenue is down 12% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Walchandnagar Industries Limited Been A Good Investment?

With a three year total loss of 57%, Walchandnagar Industries Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared the total CEO remuneration paid by Walchandnagar Industries Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However we must not forget that the EPS growth has been very strong over three years. However, the returns to investors are far less impressive, over the same period. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. Whatever your view on compensation, you might want to check if insiders are buying or selling Walchandnagar Industries shares (free trial).

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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.