Shareholders May Not Be So Generous With Som Distilleries & Breweries Limited's (NSE:SDBL) CEO Compensation And Here's Why

Key Insights

• Som Distilleries & Breweries will host its Annual General Meeting on 28th of September
• Total pay for CEO Jagdish Arora includes ₹20.2m salary
• The overall pay is 82% above the industry average
• Som Distilleries & Breweries' total shareholder return over the past three years was 662% while its EPS grew by 91% over the past three years

Under the guidance of CEO Jagdish Arora, Som Distilleries & Breweries Limited (NSE:SDBL) 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 28th of September. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for Som Distilleries & Breweries

How Does Total Compensation For Jagdish Arora Compare With Other Companies In The Industry?

At the time of writing, our data shows that Som Distilleries & Breweries Limited has a market capitalization of ₹23b, and reported total annual CEO compensation of ₹20m for the year to March 2024. That's a notable increase of 45% on last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹20m.

On comparing similar companies from the Indian Beverage industry with market caps ranging from ₹8.3b to ₹33b, we found that the median CEO total compensation was ₹11m. Accordingly, our analysis reveals that Som Distilleries & Breweries Limited pays Jagdish Arora north of the industry median. Furthermore, Jagdish Arora directly owns ₹4.9b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹20m	₹14m	100%
Other	-	-	-
Total Compensation	₹20m	₹14m	100%

On an industry level, roughly 83% of total compensation represents salary and 17% is other remuneration. At the company level, Som Distilleries & Breweries pays Jagdish Arora solely through a salary, preferring to go down a conventional route. 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.

A Look at Som Distilleries & Breweries Limited's Growth Numbers

Som Distilleries & Breweries Limited has seen its earnings per share (EPS) increase by 91% a year over the past three years. In the last year, its revenue is up 51%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Som Distilleries & Breweries Limited Been A Good Investment?

Most shareholders would probably be pleased with Som Distilleries & Breweries Limited for providing a total return of 662% 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.

In Summary...

Som Distilleries & Breweries rewards its CEO solely through a salary, ignoring non-salary benefits completely. 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.

So you may want to check if insiders are buying Som Distilleries & Breweries shares with their own money (free access).

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.