K.C.P. Sugar and Industries Corporation Limited's (NSE:KCPSUGIND) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• K.C.P. Sugar and Industries to hold its Annual General Meeting on 23rd of September
• Salary of ₹4.80m is part of CEO Irmgard Velagapudi Rao's total remuneration
• Total compensation is 33% above industry average
• K.C.P. Sugar and Industries' EPS grew by 56% over the past three years while total shareholder return over the past three years was 170%

Under the guidance of CEO Irmgard Velagapudi Rao, K.C.P. Sugar and Industries Corporation Limited (NSE:KCPSUGIND) has performed reasonably well 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. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for K.C.P. Sugar and Industries

How Does Total Compensation For Irmgard Velagapudi Rao Compare With Other Companies In The Industry?

At the time of writing, our data shows that K.C.P. Sugar and Industries Corporation Limited has a market capitalization of ₹6.5b, and reported total annual CEO compensation of ₹4.8m for the year to March 2024. We note that's a small decrease of 4.4% on last year. Notably, the salary of ₹4.8m is the entirety of the CEO compensation.

On comparing similar-sized companies in the Indian Food industry with market capitalizations below ₹17b, we found that the median total CEO compensation was ₹3.6m. Accordingly, our analysis reveals that K.C.P. Sugar and Industries Corporation Limited pays Irmgard Velagapudi Rao north of the industry median. Furthermore, Irmgard Velagapudi Rao directly owns ₹103m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹4.8m	₹4.8m	100%
Other	-	₹220k	-
Total Compensation	₹4.8m	₹5.0m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. On a company level, K.C.P. Sugar and Industries prefers to reward its CEO through a salary, opting not to pay Irmgard Velagapudi Rao through non-salary benefits. 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 K.C.P. Sugar and Industries Corporation Limited's Growth Numbers

K.C.P. Sugar and Industries Corporation Limited's earnings per share (EPS) grew 56% per year over the last three years. It achieved revenue growth of 8.7% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. 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 K.C.P. Sugar and Industries Corporation Limited Been A Good Investment?

Most shareholders would probably be pleased with K.C.P. Sugar and Industries Corporation Limited for providing a total return of 170% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

K.C.P. Sugar and Industries 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. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for K.C.P. Sugar and Industries that investors should be aware of in a dynamic business environment.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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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.