Increases to CEO Compensation Might Be Put On Hold For Now at Vadilal Industries Limited (NSE:VADILALIND)

Key Insights

• Vadilal Industries' Annual General Meeting to take place on 26th of September
• CEO Rajeshbhai Gandhi's total compensation includes salary of ₹9.47m
• Total compensation is 434% above industry average
• Vadilal Industries' total shareholder return over the past three years was 311% while its EPS grew by 74% over the past three years

CEO Rajeshbhai Gandhi has done a decent job of delivering relatively good performance at Vadilal Industries Limited (NSE:VADILALIND) recently. As shareholders go into the upcoming AGM on 26th 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 be hesitant of being overly generous with CEO compensation.

See our latest analysis for Vadilal Industries

Comparing Vadilal Industries Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Vadilal Industries Limited has a market capitalization of ₹31b, and reported total annual CEO compensation of ₹71m for the year to March 2024. We note that's an increase of 52% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹9.5m.

On comparing similar companies from the Indian Food industry with market caps ranging from ₹17b to ₹67b, we found that the median CEO total compensation was ₹13m. Accordingly, our analysis reveals that Vadilal Industries Limited pays Rajeshbhai Gandhi north of the industry median. What's more, Rajeshbhai Gandhi holds ₹1.3b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	₹9.5m	₹2.7m	13%
Other	₹61m	₹44m	87%
Total Compensation	₹71m	₹46m	100%

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. In Vadilal Industries' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Vadilal Industries Limited's Growth

Vadilal Industries Limited's earnings per share (EPS) grew 74% per year over the last three years. In the last year, its revenue is up 9.6%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 Vadilal Industries Limited Been A Good Investment?

Boasting a total shareholder return of 311% over three years, Vadilal Industries Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

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. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Vadilal Industries (free visualization of insider trades).

Important note: Vadilal Industries is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.