Here's Why Tokyo Plast International Limited's (NSE:TOKYOPLAST) CEO Compensation Is The Least Of Shareholders' Concerns

Key Insights

• Tokyo Plast International's Annual General Meeting to take place on 30th of September
• Total pay for CEO Velji Shah includes ₹4.20m salary
• The total compensation is similar to the average for the industry
• Tokyo Plast International's EPS grew by 26% over the past three years while total shareholder return over the past three years was 23%

Under the guidance of CEO Velji Shah, Tokyo Plast International Limited (NSE:TOKYOPLAST) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 30th of September. We present our case of why we think CEO compensation looks fair.

Check out our latest analysis for Tokyo Plast International

How Does Total Compensation For Velji Shah Compare With Other Companies In The Industry?

At the time of writing, our data shows that Tokyo Plast International Limited has a market capitalization of ₹1.2b, and reported total annual CEO compensation of ₹4.2m for the year to March 2024. This was the same amount the CEO received in the prior year. Notably, the salary of ₹4.2m is the entirety of the CEO compensation.

In comparison with other companies in the Indian Consumer Durables industry with market capitalizations under ₹17b, the reported median total CEO compensation was ₹4.0m. From this we gather that Velji Shah is paid around the median for CEOs in the industry.

Component	2024	2023	Proportion (2024)
Salary	₹4.2m	₹4.2m	100%
Other	-	-	-
Total Compensation	₹4.2m	₹4.2m	100%

Talking in terms of the industry, salary represented approximately 95% of total compensation out of all the companies we analyzed, while other remuneration made up 5% of the pie. On a company level, Tokyo Plast International prefers to reward its CEO through a salary, opting not to pay Velji Shah through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Tokyo Plast International Limited's Growth

Tokyo Plast International Limited has seen its earnings per share (EPS) increase by 26% a year over the past three years. It saw its revenue drop 5.9% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Tokyo Plast International Limited Been A Good Investment?

With a total shareholder return of 23% over three years, Tokyo Plast International Limited shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

Tokyo Plast International rewards its CEO solely through a salary, ignoring non-salary benefits completely. 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. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for Tokyo Plast International that investors should be aware of in a dynamic business environment.

Switching gears from Tokyo Plast International, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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