Quess Corp Limited's (NSE:QUESS) CEO Will Probably Find It Hard To See A Huge Raise This Year

Key Insights

• Quess to hold its Annual General Meeting on 16th of September
• Total pay for CEO Guru Srinivasan includes ₹21.8m salary
• The total compensation is similar to the average for the industry
• Quess' EPS grew by 68% over the past three years while total shareholder loss over the past three years was 0.4%

In the past three years, shareholders of Quess Corp Limited (NSE:QUESS) have seen a loss on their investment. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 16th of September. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

See our latest analysis for Quess

How Does Total Compensation For Guru Srinivasan Compare With Other Companies In The Industry?

According to our data, Quess Corp Limited has a market capitalization of ₹120b, and paid its CEO total annual compensation worth ₹22m over the year to March 2024. We note that's an increase of 15% above last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹22m.

In comparison with other companies in the Indian Professional Services industry with market capitalizations ranging from ₹84b to ₹269b, the reported median CEO total compensation was ₹20m. From this we gather that Guru Srinivasan is paid around the median for CEOs in the industry. Furthermore, Guru Srinivasan directly owns ₹130m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹22m	₹16m	100%
Other	-	₹3.5m	-
Total Compensation	₹22m	₹19m	100%

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. On a company level, Quess prefers to reward its CEO through a salary, opting not to pay Guru Srinivasan through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Quess Corp Limited's Growth Numbers

Over the past three years, Quess Corp Limited has seen its earnings per share (EPS) grow by 68% per year. It achieved revenue growth of 9.7% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. 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 Quess Corp Limited Been A Good Investment?

With a three year total loss of 0.4% for the shareholders, Quess Corp Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Quess pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Shareholders have not seen their shares grow in value, rather they have seen their shares decline. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Quess that you should be aware of before investing.

Important note: Quess 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.