Is Nahar Industrial Enterprises Limited's (NSE:NAHARINDUS) CEO Salary Justified?

In 1998 Kamal Oswal was appointed CEO of Nahar Industrial Enterprises Limited (NSE:NAHARINDUS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Nahar Industrial Enterprises

How Does Kamal Oswal's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Nahar Industrial Enterprises Limited has a market cap of ₹1.0b, and reported total annual CEO compensation of ₹26m for the year to March 2019. It is worth noting that the CEO compensation consists almost entirely of the salary, worth ₹26m. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹3.5m.

It would therefore appear that Nahar Industrial Enterprises Limited pays Kamal Oswal more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

The graphic below shows how CEO compensation at Nahar Industrial Enterprises has changed from year to year.

Is Nahar Industrial Enterprises Limited Growing?

On average over the last three years, Nahar Industrial Enterprises Limited has shrunk earnings per share by 64% each year (measured with a line of best fit). Its revenue is up 6.1% over last year.

Sadly for shareholders, earnings per share are actually down, over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Nahar Industrial Enterprises Limited Been A Good Investment?

Since shareholders would have lost about 81% over three years, some Nahar Industrial Enterprises Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared the total CEO remuneration paid by Nahar Industrial Enterprises Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

We think many shareholders would be underwhelmed with the business growth over the last three years. Arguably worse, investors are without a positive return for the last three years. In our opinion the CEO might be paid too generously! So you may want to check if insiders are buying Nahar Industrial Enterprises shares with their own money (free access).

If you want to buy a stock that is better than Nahar Industrial Enterprises, this free list of high return, low debt companies is a great place to look.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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