A Look At Sangam (India)'s (NSE:SANGAMIND) CEO Remuneration

The CEO of Sangam (India) Limited (NSE:SANGAMIND) is Shriniwas Modani, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Sangam (India).

View our latest analysis for Sangam (India)

Comparing Sangam (India) Limited's CEO Compensation With the industry

At the time of writing, our data shows that Sangam (India) Limited has a market capitalization of ₹3.4b, and reported total annual CEO compensation of ₹18m for the year to March 2020. We note that's an increase of 11% above last year. In particular, the salary of ₹12.7m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below ₹15b, reported a median total CEO compensation of ₹3.7m. Hence, we can conclude that Shriniwas Modani is remunerated higher than the industry median. Moreover, Shriniwas Modani also holds ₹39m worth of Sangam (India) stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. It's interesting to note that Sangam (India) allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Sangam (India) Limited's Growth Numbers

Over the last three years, Sangam (India) Limited has shrunk its earnings per share by 121% per year. In the last year, its revenue is down 33%.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. 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 Sangam (India) Limited Been A Good Investment?

Given the total shareholder loss of 46% over three years, many shareholders in Sangam (India) Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we touched on above, Sangam (India) Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Disappointingly, share price gains over the last three years have failed to materialize. To make matters worse, EPS growth has also been negative during this period. Considering such poor performance, we think shareholders might be concerned if the CEO's compensation were to grow.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 6 warning signs for Sangam (India) (2 are potentially serious!) that you should be aware of before investing here.

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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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