Nahar Capital and Financial Services Limited's (NSE:NAHARCAP) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Nahar Capital and Financial Services to hold its Annual General Meeting on 25th of September
• Salary of ₹40.5m is part of CEO Dinesh Oswal's total remuneration
• The total compensation is 3,561% higher than the average for the industry
• Nahar Capital and Financial Services' total shareholder return over the past three years was 24% while its EPS was down 40% over the past three years

CEO Dinesh Oswal has done a decent job of delivering relatively good performance at Nahar Capital and Financial Services Limited (NSE:NAHARCAP) recently. As shareholders go into the upcoming AGM on 25th of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Nahar Capital and Financial Services

How Does Total Compensation For Dinesh Oswal Compare With Other Companies In The Industry?

At the time of writing, our data shows that Nahar Capital and Financial Services Limited has a market capitalization of ₹5.4b, and reported total annual CEO compensation of ₹49m for the year to March 2024. Notably, that's an increase of 10% over the year before. In particular, the salary of ₹40.5m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Indian Capital Markets industry with market capitalizations below ₹17b, reported a median total CEO compensation of ₹1.3m. This suggests that Dinesh Oswal is paid more than the median for the industry. What's more, Dinesh Oswal holds ₹27m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	₹41m	₹37m	82%
Other	₹8.6m	₹7.7m	18%
Total Compensation	₹49m	₹45m	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. In Nahar Capital and Financial Services' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader 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.

A Look at Nahar Capital and Financial Services Limited's Growth Numbers

Nahar Capital and Financial Services Limited has reduced its earnings per share by 40% a year over the last three years. In the last year, its revenue is up 21%.

The decrease in EPS could be a concern for some investors. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. 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 Nahar Capital and Financial Services Limited Been A Good Investment?

Nahar Capital and Financial Services Limited has generated a total shareholder return of 24% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

Some shareholders will be pleased by the relatively good results, however, the results could still be improved. Until EPS growth picks back up, we think shareholders may find it hard to justify increasing CEO pay given that they are already paid above 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 3 warning signs for Nahar Capital and Financial Services that investors should think about before committing capital to this stock.

Switching gears from Nahar Capital and Financial Services, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.