How Is Avadh Sugar & Energy's (NSE:AVADHSUGAR) CEO Paid Relative To Peers?

Devendra Sharma is the CEO of Avadh Sugar & Energy Limited (NSE:AVADHSUGAR), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Avadh Sugar & Energy

Comparing Avadh Sugar & Energy Limited's CEO Compensation With the industry

At the time of writing, our data shows that Avadh Sugar & Energy Limited has a market capitalization of ₹4.3b, and reported total annual CEO compensation of ₹9.6m for the year to March 2020. That's mostly flat as compared to the prior year's compensation. In particular, the salary of ₹8.82m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below ₹15b, reported a median total CEO compensation of ₹3.5m. This suggests that Devendra Sharma is paid more than the median for the industry.

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. Although there is a difference in how total compensation is set, Avadh Sugar & Energy more or less reflects the market in terms of setting the salary. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Avadh Sugar & Energy Limited's Growth

Avadh Sugar & Energy Limited has reduced its earnings per share by 27% a year over the last three years. It achieved revenue growth of 43% over the last year.

Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Avadh Sugar & Energy Limited Been A Good Investment?

Since shareholders would have lost about 48% over three years, some Avadh Sugar & Energy Limited investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As previously discussed, Devendra is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. At the same time, looking at EPS and total shareholder returns, it's tough to say Avadh Sugar & Energy is in a sound position, considering both metrics are down. In contrast, revenue growth for the company has been showing a positive trend. Suffice it to say, we don't think the CEO is underpaid!

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 5 warning signs for Avadh Sugar & Energy you should be aware of, and 2 of them are potentially serious.

Switching gears from Avadh Sugar & Energy, 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. 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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