Shareholders Will Probably Hold Off On Increasing Alphageo (India) Limited's (NSE:ALPHAGEO) CEO Compensation For The Time Being

Key Insights

• Alphageo (India) to hold its Annual General Meeting on 27th of September
• Salary of ₹12.0m is part of CEO Dinesh Alla's total remuneration
• The total compensation is 256% higher than the average for the industry
• Over the past three years, Alphageo (India)'s EPS fell by 41% and over the past three years, the total shareholder return was 10%

CEO Dinesh Alla has done a decent job of delivering relatively good performance at Alphageo (India) Limited (NSE:ALPHAGEO) recently. 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 27th of September. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for Alphageo (India)

Comparing Alphageo (India) Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Alphageo (India) Limited has a market capitalization of ₹2.6b, and reported total annual CEO compensation of ₹16m for the year to March 2024. That is, the compensation was roughly the same as 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 India Energy Services industry with market capitalizations below ₹17b, we found that the median total CEO compensation was ₹4.4m. This suggests that Dinesh Alla is paid more than the median for the industry. Furthermore, Dinesh Alla directly owns ₹755m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹12m	₹12m	76%
Other	₹3.8m	₹3.6m	24%
Total Compensation	₹16m	₹16m	100%

On an industry level, roughly 98% of total compensation represents salary and 2% is other remuneration. It's interesting to note that Alphageo (India) allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Alphageo (India) Limited's Growth

Alphageo (India) Limited has reduced its earnings per share by 41% a year over the last three years. Its revenue is up 372% over the last year.

Investors would be a bit wary of companies that have lower EPS But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 Alphageo (India) Limited Been A Good Investment?

With a total shareholder return of 10% over three years, Alphageo (India) Limited shareholders would, in general, 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.

In Summary...

Some shareholders will be pleased by the relatively good results, however, the results could still be improved. We still think that some shareholders will be hesitant of increasing CEO pay until EPS growth improves, since they are already paid higher than the industry.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 6 warning signs (and 2 which can't be ignored) in Alphageo (India) we think you should know about.

Switching gears from Alphageo (India), 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.

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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.