Shareholders May Not Be So Generous With Century Enka Limited's (NSE:CENTENKA) CEO Compensation And Here's Why

Key Insights

• Century Enka to hold its Annual General Meeting on 12th of August
• Total pay for CEO Suresh Sodani includes ₹21.5m salary
• Total compensation is 595% above industry average
• Over the past three years, Century Enka's EPS fell by 32% and over the past three years, the total shareholder return was 17%

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

Despite positive share price growth of 17% for Century Enka Limited (NSE:CENTENKA) over the last few years, earnings growth has been disappointing, which suggests something is amiss. The upcoming AGM on 12th of August may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

View our latest analysis for Century Enka

Comparing Century Enka Limited's CEO Compensation With The Industry

Our data indicates that Century Enka Limited has a market capitalization of ₹11b, and total annual CEO compensation was reported as ₹25m for the year to March 2025. We note that's a small decrease of 6.8% on last year. Notably, the salary which is ₹21.5m, represents most of the total compensation being paid.

For comparison, other companies in the Indian Luxury industry with market capitalizations below ₹18b, reported a median total CEO compensation of ₹3.6m. Accordingly, our analysis reveals that Century Enka Limited pays Suresh Sodani north of the industry median.

Speaking on an industry level, nearly 97% of total compensation represents salary, while the remainder of 3% is other remuneration. Century Enka sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Century Enka Limited's Growth Numbers

Over the last three years, Century Enka Limited has shrunk its earnings per share by 32% per year. Its revenue is up 1.7% over the last year.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Century Enka Limited Been A Good Investment?

Century Enka Limited has served shareholders reasonably well, with a total return of 17% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

While it's true that shareholders have owned decent returns, it's hard to overlook the lack of earnings growth and this makes us question whether these returns will continue. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Century Enka you should be aware of, and 1 of them is a bit unpleasant.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.