Shareholders May Be More Conservative With Bajaj Finserv Ltd.'s (NSE:BAJAJFINSV) CEO Compensation For Now

Key Insights

• Bajaj Finserv's Annual General Meeting to take place on 24th of July
• Salary of ₹316.7m is part of CEO Sanjiv Bajaj's total remuneration
• Total compensation is 3,585% above industry average
• Bajaj Finserv's total shareholder return over the past three years was 28% while its EPS grew by 22% over the past three years

CEO Sanjiv Bajaj has done a decent job of delivering relatively good performance at Bajaj Finserv Ltd. (NSE:BAJAJFINSV) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 24th of July. However, some shareholders may still want to keep CEO compensation within reason.

View our latest analysis for Bajaj Finserv

How Does Total Compensation For Sanjiv Bajaj Compare With Other Companies In The Industry?

At the time of writing, our data shows that Bajaj Finserv Ltd. has a market capitalization of ₹2.6t, and reported total annual CEO compensation of ₹317m for the year to March 2024. That's a notable increase of 36% on last year. Notably, the salary of ₹317m is the entirety of the CEO compensation.

For comparison, other companies in the Indian Diversified Financial industry with market capitalizations above ₹668b, reported a median total CEO compensation of ₹8.6m. Hence, we can conclude that Sanjiv Bajaj is remunerated higher than the industry median. Furthermore, Sanjiv Bajaj directly owns ₹6.6b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹317m	₹233m	100%
Other	-	-	-
Total Compensation	₹317m	₹233m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. Speaking on a company level, Bajaj Finserv prefers to tread along a traditional path, disbursing all compensation through a salary. 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 Bajaj Finserv Ltd.'s Growth Numbers

Over the past three years, Bajaj Finserv Ltd. has seen its earnings per share (EPS) grow by 22% per year. In the last year, its revenue is up 35%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Bajaj Finserv Ltd. Been A Good Investment?

With a total shareholder return of 28% over three years, Bajaj Finserv Ltd. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

Bajaj Finserv pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. 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. 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.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Bajaj Finserv that investors should be aware of in a dynamic business environment.

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.

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