Shareholders Will Most Likely Find Godrej Agrovet Limited's (NSE:GODREJAGRO) CEO Compensation Acceptable

Key Insights

• Godrej Agrovet to hold its Annual General Meeting on 1st of August
• Salary of ₹46.8m is part of CEO Balram Yadav's total remuneration
• The total compensation is similar to the average for the industry
• Godrej Agrovet's total shareholder return over the past three years was 35% while its EPS grew by 4.6% over the past three years

CEO Balram Yadav has done a decent job of delivering relatively good performance at Godrej Agrovet Limited (NSE:GODREJAGRO) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 1st of August. Here is our take on why we think the CEO compensation looks appropriate.

View our latest analysis for Godrej Agrovet

Comparing Godrej Agrovet Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Godrej Agrovet Limited has a market capitalization of ₹166b, and reported total annual CEO compensation of ₹57m for the year to March 2024. We note that's a decrease of 44% compared to last year. In particular, the salary of ₹46.8m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Indian Food industry with market capitalizations ranging from ₹84b to ₹268b, the reported median CEO total compensation was ₹46m. This suggests that Godrej Agrovet remunerates its CEO largely in line with the industry average. Furthermore, Balram Yadav directly owns ₹2.4b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹47m	₹91m	82%
Other	₹10m	₹11m	18%
Total Compensation	₹57m	₹102m	100%

Talking in terms of the industry, salary represented approximately 99% of total compensation out of all the companies we analyzed, while other remuneration made up 0.64546293% of the pie. It's interesting to note that Godrej Agrovet 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.

Godrej Agrovet Limited's Growth

Over the past three years, Godrej Agrovet Limited has seen its earnings per share (EPS) grow by 4.6% per year. In the last year, its revenue is up 1.9%.

We're not particularly impressed by the revenue growth, but the modest improvement in EPS is good. Considering these factors we'd say performance has been pretty decent, though not amazing. 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 Godrej Agrovet Limited Been A Good Investment?

Boasting a total shareholder return of 35% over three years, Godrej Agrovet Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

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. 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.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 2 warning signs for Godrej Agrovet that investors should be aware of in a dynamic business environment.

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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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com