Is Motilal Oswal Financial Services Limited’s (NSE:MOTILALOFS) CEO Paid At A Competitive Rate?

The CEO of Motilal Oswal Financial Services Limited (NSE:MOTILALOFS) is Motilal Oswal. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Motilal Oswal Financial Services

How Does Motilal Oswal’s Compensation Compare With Similar Sized Companies?

According to our data, Motilal Oswal Financial Services Limited has a market capitalization of ₹109b, and paid its CEO total annual compensation worth ₹24m over the year to March 2019. Notably, the salary of ₹24m is the vast majority of the CEO compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of ₹72b to ₹230b. The median total CEO compensation was ₹43m.

A first glance this seems like a real positive for shareholders, since Motilal Oswal is paid less than the average total compensation paid by similar sized companies. Though positive, it’s important we delve into the performance of the actual business. Shareholders might be interested in this free visualization of analyst forecasts.

The graphic below shows how CEO compensation at Motilal Oswal Financial Services has changed from year to year.

NSEI:MOTILALOFS CEO Compensation, November 22nd 2019
NSEI:MOTILALOFS CEO Compensation, November 22nd 2019

Is Motilal Oswal Financial Services Limited Growing?

On average over the last three years, Motilal Oswal Financial Services Limited has shrunk earnings per share by 1.4% each year (measured with a line of best fit). Its revenue is down 7.2% over last year.

In the last three years the company has failed to grow earnings per share. And the impression is worse when you consider revenue is down year-on-year. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.

Has Motilal Oswal Financial Services Limited Been A Good Investment?

I think that the total shareholder return of 55%, over three years, would leave most Motilal Oswal Financial Services Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

It looks like Motilal Oswal Financial Services Limited pays its CEO less than similar sized companies.

Motilal Oswal receives relatively low remuneration compared to similar sized companies. And while the company isn’t growing earnings per share, total returns have been pleasing. We would like to see EPS growth, but in our view it seems the CEO is remunerated reasonably. Whatever your view on compensation, you might want to check if insiders are buying or selling Motilal Oswal Financial Services shares (free trial).

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

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