Increases to Lagnam Spintex Limited's (NSE:LAGNAM) CEO Compensation Might Cool off for now

Key Insights

• Lagnam Spintex to hold its Annual General Meeting on 16th of July
• CEO Anand Mangal's total compensation includes salary of ₹4.85m
• The total compensation is 89% higher than the average for the industry
• Over the past three years, Lagnam Spintex's EPS grew by 48% and over the past three years, the total shareholder return was 443%

Performance at Lagnam Spintex Limited (NSE:LAGNAM) has been reasonably good and CEO Anand Mangal has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 16th of July, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Lagnam Spintex

Comparing Lagnam Spintex Limited's CEO Compensation With The Industry

Our data indicates that Lagnam Spintex Limited has a market capitalization of ₹2.8b, and total annual CEO compensation was reported as ₹7.1m for the year to March 2024. That's a notable increase of 41% on last year. In particular, the salary of ₹4.85m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Indian Luxury industry with market capitalizations below ₹17b, reported a median total CEO compensation of ₹3.8m. Hence, we can conclude that Anand Mangal is remunerated higher than the industry median. Moreover, Anand Mangal also holds ₹196m worth of Lagnam Spintex stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	₹4.9m	₹4.3m	68%
Other	₹2.3m	₹748k	32%
Total Compensation	₹7.1m	₹5.1m	100%

Talking in terms of the industry, salary represented approximately 100% of total compensation out of all the companies we analyzed, while other remuneration made up 0.22518415% of the pie. In Lagnam Spintex's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Lagnam Spintex Limited's Growth

Lagnam Spintex Limited has seen its earnings per share (EPS) increase by 48% a year over the past three years. Its revenue is up 44% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Lagnam Spintex Limited Been A Good Investment?

We think that the total shareholder return of 443%, over three years, would leave most Lagnam Spintex 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...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 4 warning signs for Lagnam Spintex (2 can't be ignored!) that you should be aware of before investing here.

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. 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.

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