Shareholders May Not Be So Generous With VLS Finance Limited's (NSE:VLSFINANCE) CEO Compensation And Here's Why

Under the guidance of CEO Suresh Agarwal, VLS Finance Limited (NSE:VLSFINANCE) has performed reasonably well recently. As shareholders go into the upcoming AGM on 30 September 2022, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for VLS Finance

Comparing VLS Finance Limited's CEO Compensation With The Industry

Our data indicates that VLS Finance Limited has a market capitalization of ₹5.5b, and total annual CEO compensation was reported as ₹4.1m for the year to March 2022. This was the same as last year. Notably, the salary of ₹4.1m is the entirety of the CEO compensation.

For comparison, other companies in the industry with market capitalizations below ₹16b, reported a median total CEO compensation of ₹1.3m. This suggests that Suresh Agarwal is paid more than the median for the industry.

Component	2022	2021	Proportion (2022)
Salary	₹4.1m	₹4.1m	100%
Other	-	-	-
Total Compensation	₹4.1m	₹4.1m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. At the company level, VLS Finance pays Suresh Agarwal solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at VLS Finance Limited's Growth Numbers

VLS Finance Limited's earnings per share (EPS) grew 68% per year over the last three years. In the last year, its revenue is down 50%.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 VLS Finance Limited Been A Good Investment?

Boasting a total shareholder return of 160% over three years, VLS Finance Limited has done well by shareholders. 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...

VLS Finance rewards its CEO solely through a salary, ignoring non-salary benefits completely. Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 3 warning signs for VLS Finance that investors should be aware of in a dynamic business environment.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.