Pulkit Seth became the CEO of Pearl Global Industries Limited (NSE:PGIL) in 2013. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Pulkit Seth’s Compensation Compare With Similar Sized Companies?
Our data indicates that Pearl Global Industries Limited is worth ₹2.9b, and total annual CEO compensation is ₹12m. We note that’s an increase of 22% above last year. We examined a group of similar sized companies, with market capitalizations of below ₹14.6b. The median CEO compensation in that group is ₹2m.
It would therefore appear that Pearl Global Industries Limited pays Pulkit Seth 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 better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Pearl Global Industries has changed from year to year.
Is Pearl Global Industries Limited Growing?
Pearl Global Industries Limited has reduced its earnings per share by an average of 9.8% a year, over the last three years. Its revenue is down -2.8% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO. We don’t have analyst forecasts, but you could get a better understanding of its growth by checking out this free more detailed historical graph of earnings, revenue and cash flow.
Has Pearl Global Industries Limited Been A Good Investment?
Since shareholders would have lost about 28% over three years, some Pearl Global Industries Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We examined the amount Pearl Global Industries Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
Just as bad, share price gains for investors have failed to materialize, over the same period. This contrasts with the growth in CEO remuneration, year on year. This analysis suggests to us that the CEO is paid too generously! Even if a company pays the CEO quite generously, that doesn’t mean it’s a bad investment. Nonetheless, it could be useful to double-check if insiders have sold shares recently.
But note: Pearl Global Industries may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.