How Much Did Filatex India's (NSE:FILATEX) CEO Pocket Last Year?

Madhu Bhageria has been the CEO of Filatex India Limited (NSE:FILATEX) since 2008, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Filatex India pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Filatex India

Comparing Filatex India Limited's CEO Compensation With the industry

At the time of writing, our data shows that Filatex India Limited has a market capitalization of ₹14b, and reported total annual CEO compensation of ₹12m for the year to March 2020. Notably, that's a decrease of 9.2% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹5.4m.

In comparison with other companies in the industry with market capitalizations ranging from ₹7.3b to ₹29b, the reported median CEO total compensation was ₹22m. Accordingly, Filatex India pays its CEO under the industry median. Moreover, Madhu Bhageria also holds ₹1.6b worth of Filatex India stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, it's fascinating to see that all of total compensation represents salary and non-salary benefits do not factor into the equation at all. Filatex India sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Filatex India Limited's Growth Numbers

Over the past three years, Filatex India Limited has seen its earnings per share (EPS) grow by 4.2% per year. It saw its revenue drop 27% over the last year.

We would argue that the lack of revenue growth in the last year is less than ideal, but the modest improvement in EPS is good. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Filatex India Limited Been A Good Investment?

We think that the total shareholder return of 43%, over three years, would leave most Filatex India Limited shareholders smiling. 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.

In Summary...

As we touched on above, Filatex India Limited is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. On the other hand, shareholder returns have been have been very pleasing, over the last three years, and that should put a smile on the faces of investors. As a result of the juicy return to investors, CEO compensation may well be quite reasonable.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 2 warning signs for Filatex India (1 is significant!) that you should be aware of before investing here.

Important note: Filatex India 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. 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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