Increases to CEO Compensation Might Be Put On Hold For Now at Paisalo Digital Limited (NSE:PAISALO)

Performance at Paisalo Digital Limited (NSE:PAISALO) has been reasonably good and CEO Sunil Agarwal has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 25 September 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Paisalo Digital

How Does Total Compensation For Sunil Agarwal Compare With Other Companies In The Industry?

According to our data, Paisalo Digital Limited has a market capitalization of ₹34b, and paid its CEO total annual compensation worth ₹38m over the year to March 2021. That's slightly lower by 4.3% over the previous year. Notably, the salary of ₹38m is the entirety of the CEO compensation.

In comparison with other companies in the industry with market capitalizations ranging from ₹15b to ₹59b, the reported median CEO total compensation was ₹7.4m. This suggests that Sunil Agarwal is paid more than the median for the industry. Moreover, Sunil Agarwal also holds ₹4.2b worth of Paisalo Digital stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	₹38m	₹39m	100%
Other	-	-	-
Total Compensation	₹38m	₹39m	100%

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. Speaking on a company level, Paisalo Digital prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Paisalo Digital Limited's Growth Numbers

Over the last three years, Paisalo Digital Limited has not seen its earnings per share change much, though there is a slight positive movement. In the last year, its revenue is down 11%.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Paisalo Digital Limited Been A Good Investment?

We think that the total shareholder return of 172%, over three years, would leave most Paisalo Digital 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...

Paisalo Digital rewards its CEO solely through a salary, ignoring non-salary benefits completely. The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed 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.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which shouldn't be ignored) in Paisalo Digital we think you should know about.

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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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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