A Look At JSW Holdings' (NSE:JSWHL) CEO Remuneration

Kantilal Patel has been the CEO of JSW Holdings Limited (NSE:JSWHL) since 2005, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for JSW Holdings

How Does Total Compensation For Kantilal Patel Compare With Other Companies In The Industry?

According to our data, JSW Holdings Limited has a market capitalization of ₹40b, and paid its CEO total annual compensation worth ₹29m over the year to March 2020. We note that's a small decrease of 6.1% on last year. We note that the salary portion, which stands at ₹21.8m constitutes the majority of total compensation received by the CEO.

On examining similar-sized companies in the industry with market capitalizations between ₹15b and ₹58b, we discovered that the median CEO total compensation of that group was ₹21m. Hence, we can conclude that Kantilal Patel is remunerated higher than the industry median.

On an industry level, it's fascinating to see that all of total compensation represents salary and non-salary benefits do not factor into the equation at all. JSW Holdings sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

JSW Holdings Limited's Growth

Over the past three years, JSW Holdings Limited has seen its earnings per share (EPS) grow by 2.0% per year. In the last year, its revenue is down 26%.

We would prefer it if there was revenue growth, but the modest EPSgrowth gives us some relief. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has JSW Holdings Limited Been A Good Investment?

We think that the total shareholder return of 114%, over three years, would leave most JSW Holdings Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

As we noted earlier, JSW Holdings pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Importantly though, shareholder returns for the last three years have been excellent. Albeit, EPS growth has not been as impressive over the same time frame. We'd ideally want to see higher EPS growth, but CEO compensation seems to be within reason, given high shareholder returns.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for JSW Holdings that investors should look into moving forward.

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. 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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