Stock Analysis

Britannia Industries Limited's (NSE:BRITANNIA) CEO Compensation Looks Acceptable To Us And Here's Why

  •  Updated
NSEI:BRITANNIA
Source: Shutterstock

Under the guidance of CEO Varun Berry, Britannia Industries Limited (NSE:BRITANNIA) has performed reasonably well 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 06 September 2021. We present our case of why we think CEO compensation looks fair.

Check out our latest analysis for Britannia Industries

Comparing Britannia Industries Limited's CEO Compensation With the industry

Our data indicates that Britannia Industries Limited has a market capitalization of ₹960b, and total annual CEO compensation was reported as ₹105m for the year to March 2021. That's a modest increase of 7.5% on the prior year. We note that the salary of ₹61.9m makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations above ₹586b, reported a median total CEO compensation of ₹105m. This suggests that Britannia Industries remunerates its CEO largely in line with the industry average.

Component20212020Proportion (2021)
Salary ₹62m ₹58m 59%
Other ₹43m ₹40m 41%
Total Compensation₹105m ₹98m100%

On an industry level, it's fascinating to see that all of total compensation represents salary and non-salary benefits do not factor into the equation at all. It's interesting to note that Britannia Industries allocates a smaller portion of compensation to salary in comparison to the broader industry. 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.

ceo-compensation
NSEI:BRITANNIA CEO Compensation August 31st 2021

Britannia Industries Limited's Growth

Britannia Industries Limited's earnings per share (EPS) grew 18% per year over the last three years. In the last year, its revenue is up 6.7%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Britannia Industries Limited Been A Good Investment?

Britannia Industries Limited has generated a total shareholder return of 29% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

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, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 2 warning signs for Britannia Industries that investors should look into moving forward.

Important note: Britannia Industries 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.

When trading Britannia Industries or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted


Valuation is complex, but we're helping make it simple.

Find out whether Britannia Industries is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis