What Can We Make Of AYM Syntex's (NSE:AYMSYNTEX) CEO Compensation?

Abhishek Mandawewala is the CEO of AYM Syntex Limited (NSE:AYMSYNTEX), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for AYM Syntex

How Does Total Compensation For Abhishek Mandawewala Compare With Other Companies In The Industry?

According to our data, AYM Syntex Limited has a market capitalization of ₹1.4b, and paid its CEO total annual compensation worth ₹7.4m over the year to March 2020. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at ₹7.00m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under ₹15b, the reported median total CEO compensation was ₹4.1m. Hence, we can conclude that Abhishek Mandawewala is remunerated higher than the industry median.

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. AYM Syntex is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

AYM Syntex Limited's Growth

AYM Syntex Limited has reduced its earnings per share by 39% a year over the last three years. In the last year, its revenue is down 21%.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has AYM Syntex Limited Been A Good Investment?

With a three year total loss of 58% for the shareholders, AYM Syntex Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Abhishek receives almost all of their compensation through a salary. As previously discussed, Abhishek is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. To make matters worse, EPS growth has also been negative during this period. Considering such poor performance, we think shareholders might be concerned if the CEO's compensation were to grow.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 3 warning signs (and 2 which are a bit unpleasant) in AYM Syntex we think you should know about.

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. 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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