It Looks Like Satin Creditcare Network Limited's (NSE:SATIN) CEO May Expect Their Salary To Be Put Under The Microscope

The results at Satin Creditcare Network Limited (NSE:SATIN) have been quite disappointing recently and CEO Harvinder Singh bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 11 August 2021. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Satin Creditcare Network

Comparing Satin Creditcare Network Limited's CEO Compensation With the industry

At the time of writing, our data shows that Satin Creditcare Network Limited has a market capitalization of ₹6.1b, and reported total annual CEO compensation of ₹15m for the year to March 2021. We note that's a decrease of 47% compared to last year. In particular, the salary of ₹12.0m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below ₹15b, we found that the median total CEO compensation was ₹600k. Hence, we can conclude that Harvinder Singh is remunerated higher than the industry median.

Component	2021	2020	Proportion (2021)
Salary	₹12m	₹23m	78%
Other	₹3.5m	₹6.5m	22%
Total Compensation	₹15m	₹29m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. Satin Creditcare Network sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Satin Creditcare Network Limited's Growth Numbers

Over the last three years, Satin Creditcare Network Limited has shrunk its earnings per share by 25% per year. It saw its revenue drop 19% over the last year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Satin Creditcare Network Limited Been A Good Investment?

With a total shareholder return of -76% over three years, Satin Creditcare Network Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 3 warning signs (and 1 which is a bit unpleasant) in Satin Creditcare Network 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. 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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