What Can We Make Of Magadh Sugar & Energy's (NSE:MAGADSUGAR) CEO Compensation?

The CEO of Magadh Sugar & Energy Limited (NSE:MAGADSUGAR) is Chandra Mohan, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Magadh Sugar & Energy pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Magadh Sugar & Energy

How Does Total Compensation For Chandra Mohan Compare With Other Companies In The Industry?

Our data indicates that Magadh Sugar & Energy Limited has a market capitalization of ₹1.5b, and total annual CEO compensation was reported as ₹9.7m for the year to March 2020. We note that's an increase of 12% above last year. Notably, the salary of ₹9.7m is the entirety of the CEO compensation.

On comparing similar-sized companies in the industry with market capitalizations below ₹15b, we found that the median total CEO compensation was ₹3.5m. Accordingly, our analysis reveals that Magadh Sugar & Energy Limited pays Chandra Mohan north of the industry median.

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

A Look at Magadh Sugar & Energy Limited's Growth Numbers

Magadh Sugar & Energy Limited's earnings per share (EPS) grew 23% per year over the last three years. Its revenue is up 41% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Magadh Sugar & Energy Limited Been A Good Investment?

With a total shareholder return of 10% over three years, Magadh Sugar & Energy Limited shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

Magadh Sugar & Energy rewards its CEO solely through a salary, ignoring non-salary benefits completely. As we touched on above, Magadh Sugar & Energy Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the company has impressed us with its EPS growth, over three years. Looking at the same time period, we think that the shareholder returns are respectable. So, considering the EPS growth we do not wish to criticize CEO compensation, though we'd recommend further research on management.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 4 warning signs for Magadh Sugar & Energy (1 can't be ignored!) that you should be aware of before investing here.

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. 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.
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