How Much is Ugar Sugar Works' (NSE:UGARSUGAR) CEO Getting Paid?

This article will reflect on the compensation paid to Niraj Shirgaokar who has served as CEO of The Ugar Sugar Works Limited (NSE:UGARSUGAR) since 2011. This analysis will also assess whether Ugar Sugar Works pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Ugar Sugar Works

Comparing The Ugar Sugar Works Limited's CEO Compensation With the industry

According to our data, The Ugar Sugar Works Limited has a market capitalization of ₹1.5b, and paid its CEO total annual compensation worth ₹14m over the year to March 2020. Notably, that's an increase of 21% over the year before. In particular, the salary of ₹7.49m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below ₹15b, reported a median total CEO compensation of ₹4.2m. Accordingly, our analysis reveals that The Ugar Sugar Works Limited pays Niraj Shirgaokar north of the industry median. What's more, Niraj Shirgaokar holds ₹3.4m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Speaking on an industry level, nearly 100% of total compensation represents salary, while the remainder of 0.3% is other remuneration. Ugar Sugar Works sets aside a smaller share of compensation for salary, in comparison to the overall 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.

The Ugar Sugar Works Limited's Growth

The Ugar Sugar Works Limited's earnings per share (EPS) grew 133% per year over the last three years. It achieved revenue growth of 7.0% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has The Ugar Sugar Works Limited Been A Good Investment?

Given the total shareholder loss of 42% over three years, many shareholders in The Ugar Sugar Works Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

As previously discussed, Niraj is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, the EPS growth is certainly impressive, but shareholder returns — over the same period — have been disappointing. Although we'd stop short of calling it inappropriate, we think Niraj is earning a very handsome sum.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 3 warning signs for Ugar Sugar Works (1 makes us a bit uncomfortable!) 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.

When trading Ugar Sugar Works or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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