It's Unlikely That Kapston Services Limited's (NSE:KAPSTON) CEO Will See A Huge Pay Rise This Year

Under the guidance of CEO Srikanth Kodali, Kapston Services Limited (NSE:KAPSTON) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 23 September 2022. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Kapston Services

How Does Total Compensation For Srikanth Kodali Compare With Other Companies In The Industry?

According to our data, Kapston Services Limited has a market capitalization of ₹1.4b, and paid its CEO total annual compensation worth ₹12m over the year to March 2022. We note that's an increase of 38% above last year. Notably, the salary of ₹12m is the entirety of the CEO compensation.

For comparison, other companies in the industry with market capitalizations below ₹16b, reported a median total CEO compensation of ₹2.4m. Accordingly, our analysis reveals that Kapston Services Limited pays Srikanth Kodali north of the industry median. Furthermore, Srikanth Kodali directly owns ₹986m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2022	2021	Proportion (2022)
Salary	₹12m	₹8.7m	100%
Other	-	-	-
Total Compensation	₹12m	₹8.7m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. At the company level, Kapston Services pays Srikanth Kodali solely through a salary, preferring to go down a conventional route. 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.

Kapston Services Limited's Growth

Kapston Services Limited has reduced its earnings per share by 24% a year over the last three years. In the last year, its revenue is up 43%.

The decrease in EPS could be a concern for some investors. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Kapston Services Limited Been A Good Investment?

Boasting a total shareholder return of 72% over three years, Kapston Services Limited has done well by shareholders. 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.

To Conclude...

Kapston Services rewards its CEO solely through a salary, ignoring non-salary benefits completely. Although the company has performed relatively well, we still think there are some areas that could be improved. We still think that some shareholders will be hesitant of increasing CEO pay until EPS growth improves, since they are already paid higher than the industry.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 4 warning signs (and 2 which can't be ignored) in Kapston Services we think you should know about.

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. 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.