Increases to Kaveri Seed Company Limited's (NSE:KSCL) CEO Compensation Might Cool off for now

Key Insights

• Kaveri Seed to hold its Annual General Meeting on 29th of September
• Salary of ₹47.1m is part of CEO Gundavaram Venkata Rao's total remuneration
• The total compensation is 183% higher than the average for the industry
• Kaveri Seed's EPS grew by 0.4% over the past three years while total shareholder return over the past three years was 22%

CEO Gundavaram Venkata Rao has done a decent job of delivering relatively good performance at Kaveri Seed Company Limited (NSE:KSCL) recently. As shareholders go into the upcoming AGM on 29th of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for Kaveri Seed

How Does Total Compensation For Gundavaram Venkata Rao Compare With Other Companies In The Industry?

Our data indicates that Kaveri Seed Company Limited has a market capitalization of ₹35b, and total annual CEO compensation was reported as ₹50m for the year to March 2023. That's a notable increase of 21% on last year. Notably, the salary which is ₹47.1m, represents most of the total compensation being paid.

On examining similar-sized companies in the Indian Food industry with market capitalizations between ₹17b and ₹66b, we discovered that the median CEO total compensation of that group was ₹18m. This suggests that Gundavaram Venkata Rao is paid more than the median for the industry. What's more, Gundavaram Venkata Rao holds ₹3.4b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	₹47m	₹39m	94%
Other	₹3.3m	₹2.8m	6%
Total Compensation	₹50m	₹42m	100%

On an industry level, roughly 95% of total compensation represents salary and 5% is other remuneration. Our data reveals that Kaveri Seed allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Kaveri Seed Company Limited's Growth Numbers

Kaveri Seed Company Limited saw earnings per share stay pretty flat over the last three years. Its revenue is up 9.3% over the last year.

We're not particularly impressed by the revenue growth, but we're happy with the modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Kaveri Seed Company Limited Been A Good Investment?

Kaveri Seed Company Limited has generated a total shareholder return of 22% 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.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

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've identified 1 warning sign for Kaveri Seed 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.