Here's What We Learned About The CEO Pay At The Bombay Burmah Trading Corporation, Limited (NSE:BBTC)

Ness Wadia is the CEO of The Bombay Burmah Trading Corporation, Limited (NSE:BBTC), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Bombay Burmah Trading Corporation.

View our latest analysis for Bombay Burmah Trading Corporation

Comparing The Bombay Burmah Trading Corporation, Limited's CEO Compensation With the industry

At the time of writing, our data shows that The Bombay Burmah Trading Corporation, Limited has a market capitalization of ₹83b, and reported total annual CEO compensation of ₹32m for the year to March 2020. We note that's a decrease of 16% compared to last year. Notably, the salary which is ₹25.9m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from ₹29b to ₹116b, the reported median CEO total compensation was ₹39m. This suggests that Bombay Burmah Trading Corporation remunerates its CEO largely in line with the industry average. Furthermore, Ness Wadia directly owns ₹26m worth of shares in the company, implying that they are deeply invested in the company's success.

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. It's interesting to note that Bombay Burmah Trading Corporation 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.

A Look at The Bombay Burmah Trading Corporation, Limited's Growth Numbers

The Bombay Burmah Trading Corporation, Limited has seen its earnings per share (EPS) increase by 13% a year over the past three years. It achieved revenue growth of 11% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. 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 The Bombay Burmah Trading Corporation, Limited Been A Good Investment?

Given the total shareholder loss of 23% over three years, many shareholders in The Bombay Burmah Trading Corporation, Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we noted earlier, Bombay Burmah Trading Corporation pays its CEO in line with similar-sized companies belonging to the same industry. Meanwhile, shareholder returns paint a sorry picture for the company, finishing in the red over the last three years. However, EPS growth is positive over the same time frame. It's tough for us to say CEO compensation is too generous when EPS growth is positive, but negative investor returns will irk shareholders and reduce any chances of a raise.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for Bombay Burmah Trading Corporation that investors should think about before committing capital to this stock.

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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