We Think Some Shareholders May Hesitate To Increase TAJGVK Hotels & Resorts Limited's (NSE:TAJGVK) CEO Compensation

Key Insights

• TAJGVK Hotels & Resorts' Annual General Meeting to take place on 15th of September
• CEO Gunapati Reddy's total compensation includes salary of ₹37.9m
• The total compensation is 255% higher than the average for the industry
• TAJGVK Hotels & Resorts' total shareholder return over the past three years was 73% while its EPS grew by 350% over the past three years

CEO Gunapati Reddy has done a decent job of delivering relatively good performance at TAJGVK Hotels & Resorts Limited (NSE:TAJGVK) 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.

View our latest analysis for TAJGVK Hotels & Resorts

Comparing TAJGVK Hotels & Resorts Limited's CEO Compensation With The Industry

According to our data, TAJGVK Hotels & Resorts Limited has a market capitalization of ₹15b, and paid its CEO total annual compensation worth ₹55m over the year to March 2023. Notably, that's an increase of 42% over the year before. In particular, the salary of ₹37.9m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the Indian Hospitality industry with market caps ranging from ₹8.3b to ₹33b, we found that the median CEO total compensation was ₹16m. This suggests that Gunapati Reddy is paid more than the median for the industry. Furthermore, Gunapati Reddy directly owns ₹7.4b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	₹38m	₹34m	69%
Other	₹17m	₹4.8m	31%
Total Compensation	₹55m	₹39m	100%

On an industry level, roughly 97% of total compensation represents salary and 3% is other remuneration. TAJGVK Hotels & Resorts sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at TAJGVK Hotels & Resorts Limited's Growth Numbers

Over the past three years, TAJGVK Hotels & Resorts Limited has seen its earnings per share (EPS) grow by 350% per year. Its revenue is up 44% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has TAJGVK Hotels & Resorts Limited Been A Good Investment?

Boasting a total shareholder return of 73% over three years, TAJGVK Hotels & Resorts Limited has done well by shareholders. 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.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for TAJGVK Hotels & Resorts that investors should think about before committing capital to this stock.

Switching gears from TAJGVK Hotels & Resorts, 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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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.