Increases to HDFC Asset Management Company Limited's (NSE:HDFCAMC) CEO Compensation Might Cool off for now

Key Insights

• HDFC Asset Management's Annual General Meeting to take place on 25th of July
• Total pay for CEO Navneet Munot includes ₹45.8m salary
• Total compensation is 102% above industry average
• Over the past three years, HDFC Asset Management's EPS grew by 15% and over the past three years, the total shareholder return was 54%

Performance at HDFC Asset Management Company Limited (NSE:HDFCAMC) has been reasonably good and CEO Navneet Munot has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 25th of July, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for HDFC Asset Management

How Does Total Compensation For Navneet Munot Compare With Other Companies In The Industry?

Our data indicates that HDFC Asset Management Company Limited has a market capitalization of ₹889b, and total annual CEO compensation was reported as ₹85m for the year to March 2024. Notably, that's an increase of 8.5% over the year before. We note that the salary of ₹45.8m makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the Indian Capital Markets industry with market capitalizations above ₹669b, reported a median total CEO compensation of ₹42m. This suggests that Navneet Munot is paid more than the median for the industry. Furthermore, Navneet Munot directly owns ₹91m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹46m	₹44m	54%
Other	₹39m	₹34m	46%
Total Compensation	₹85m	₹78m	100%

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. HDFC Asset Management pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at HDFC Asset Management Company Limited's Growth Numbers

Over the past three years, HDFC Asset Management Company Limited has seen its earnings per share (EPS) grow by 15% per year. In the last year, its revenue is up 26%.

Shareholders would be glad to know that the company has improved itself over the last few 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 HDFC Asset Management Company Limited Been A Good Investment?

We think that the total shareholder return of 54%, over three years, would leave most HDFC Asset Management Company Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus 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 2 warning signs for HDFC Asset Management that investors should think about before committing capital to this stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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