It Looks Like Shareholders Would Probably Approve Lemon Tree Hotels Limited's (NSE:LEMONTREE) CEO Compensation Package

Key Insights

• Lemon Tree Hotels to hold its Annual General Meeting on 26th of September
• Salary of ₹42.9m is part of CEO Patu Keswani's total remuneration
• Total compensation is similar to the industry average
• Lemon Tree Hotels' total shareholder return over the past three years was 194% while its EPS grew by 108% over the past three years

The performance at Lemon Tree Hotels Limited (NSE:LEMONTREE) has been quite strong recently and CEO Patu Keswani has played a role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 26th of September. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

View our latest analysis for Lemon Tree Hotels

How Does Total Compensation For Patu Keswani Compare With Other Companies In The Industry?

Our data indicates that Lemon Tree Hotels Limited has a market capitalization of ₹100b, and total annual CEO compensation was reported as ₹43m for the year to March 2024. We note that's an increase of 23% above last year. Notably, the salary of ₹43m is the entirety of the CEO compensation.

On examining similar-sized companies in the Indian Hospitality industry with market capitalizations between ₹33b and ₹134b, we discovered that the median CEO total compensation of that group was ₹40m. This suggests that Lemon Tree Hotels remunerates its CEO largely in line with the industry average.

Component	2024	2023	Proportion (2024)
Salary	₹43m	₹35m	100%
Other	-	-	-
Total Compensation	₹43m	₹35m	100%

On an industry level, around 95% of total compensation represents salary and 5% is other remuneration. Speaking on a company level, Lemon Tree Hotels prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Lemon Tree Hotels Limited's Growth Numbers

Lemon Tree Hotels Limited's earnings per share (EPS) grew 108% per year over the last three years. Its revenue is up 23% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Lemon Tree Hotels Limited Been A Good Investment?

Most shareholders would probably be pleased with Lemon Tree Hotels Limited for providing a total return of 194% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Lemon Tree Hotels rewards its CEO solely through a salary, ignoring non-salary benefits completely. Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Lemon Tree Hotels that investors should think about before committing capital to this 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.

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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.