This Is Why Prataap Snacks Limited's (NSE:DIAMONDYD) CEO Compensation Looks Appropriate

Key Insights

• Prataap Snacks to hold its Annual General Meeting on 23rd of September
• Salary of ₹10.4m is part of CEO Amit Kumat's total remuneration
• The overall pay is comparable to the industry average
• Over the past three years, Prataap Snacks' EPS grew by 38% and over the past three years, the total shareholder return was 21%

CEO Amit Kumat has done a decent job of delivering relatively good performance at Prataap Snacks Limited (NSE:DIAMONDYD) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 23rd of September. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for Prataap Snacks

How Does Total Compensation For Amit Kumat Compare With Other Companies In The Industry?

According to our data, Prataap Snacks Limited has a market capitalization of ₹19b, and paid its CEO total annual compensation worth ₹10m over the year to March 2024. We note that's an increase of 15% above last year. Notably, the salary of ₹10m is the entirety of the CEO compensation.

On examining similar-sized companies in the Indian Food industry with market capitalizations between ₹8.4b and ₹34b, we discovered that the median CEO total compensation of that group was ₹14m. From this we gather that Amit Kumat is paid around the median for CEOs in the industry. Furthermore, Amit Kumat directly owns ₹963m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹10m	₹9.0m	100%
Other	-	-	-
Total Compensation	₹10m	₹9.0m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. On a company level, Prataap Snacks prefers to reward its CEO through a salary, opting not to pay Amit Kumat through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Prataap Snacks Limited's Growth

Prataap Snacks Limited has seen its earnings per share (EPS) increase by 38% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Prataap Snacks Limited Been A Good Investment?

Prataap Snacks Limited has generated a total shareholder return of 21% over three years, so most shareholders would 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.

To Conclude...

Prataap Snacks pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Prataap Snacks that you should be aware of before investing.

Switching gears from Prataap Snacks, 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.