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

Key Insights

• RSWM's Annual General Meeting to take place on 15th of September
• Salary of ₹30.1m is part of CEO Riju Jhunjhunwala's total remuneration
• Total compensation is 1,172% above industry average
• Over the past three years, RSWM's EPS grew by 54% and over the past three years, the total shareholder return was 297%

Under the guidance of CEO Riju Jhunjhunwala, RSWM Limited (NSE:RSWM) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 15th of September. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for RSWM

How Does Total Compensation For Riju Jhunjhunwala Compare With Other Companies In The Industry?

According to our data, RSWM Limited has a market capitalization of ₹9.9b, and paid its CEO total annual compensation worth ₹49m over the year to March 2023. Notably, that's a decrease of 20% over the year before. Notably, the salary which is ₹30.1m, represents most of the total compensation being paid.

In comparison with other companies in the Indian Luxury industry with market capitalizations under ₹17b, the reported median total CEO compensation was ₹3.9m. This suggests that Riju Jhunjhunwala is paid more than the median for the industry. Furthermore, Riju Jhunjhunwala directly owns ₹79m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	₹30m	₹21m	61%
Other	₹19m	₹41m	39%
Total Compensation	₹49m	₹62m	100%

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. In RSWM's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at RSWM Limited's Growth Numbers

Over the past three years, RSWM Limited has seen its earnings per share (EPS) grow by 54% per year. In the last year, its revenue is down 11%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 RSWM Limited Been A Good Investment?

Boasting a total shareholder return of 297% over three years, RSWM Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus 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. That's why we did our research, and identified 4 warning signs for RSWM (of which 2 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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.