Here's Why Shareholders May Want To Be Cautious With Increasing SIL Investments Limited's (NSE:SILINV) CEO Pay Packet

Key Insights

• SIL Investments to hold its Annual General Meeting on 29th of July
• CEO Shalini Nopany's total compensation includes salary of ₹12.3m
• The total compensation is 1,099% higher than the average for the industry
• SIL Investments' EPS declined by 2.1% over the past three years while total shareholder return over the past three years was 99%

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SIL Investments Limited (NSE:SILINV) has exhibited strong share price growth in the past few years. However, its earnings growth has not kept up, suggesting that there may be something amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 29th of July. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

Check out our latest analysis for SIL Investments

How Does Total Compensation For Shalini Nopany Compare With Other Companies In The Industry?

At the time of writing, our data shows that SIL Investments Limited has a market capitalization of ₹6.4b, and reported total annual CEO compensation of ₹14m for the year to March 2025. That's a notable increase of 55% on last year. We note that the salary portion, which stands at ₹12.3m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Indian Capital Markets industry with market capitalizations below ₹17b, reported a median total CEO compensation of ₹1.2m. Accordingly, our analysis reveals that SIL Investments Limited pays Shalini Nopany north of the industry median.

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. SIL Investments pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at SIL Investments Limited's Growth Numbers

Over the last three years, SIL Investments Limited has shrunk its earnings per share by 2.1% per year. Its revenue is up 8.5% over the last year.

Its a bit disappointing to see that the company has failed to grow its EPS. The fairly low revenue growth fails to impress given that the EPS is down. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has SIL Investments Limited Been A Good Investment?

Boasting a total shareholder return of 99% over three years, SIL Investments Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Although shareholders would be quite happy with the returns they have earned on their initial investment, earnings have failed to grow and this could mean returns may be hard to keep up. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for SIL Investments that investors should look into moving forward.

Important note: SIL Investments is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.