Why We Think Apollo Hospitals Enterprise Limited's (NSE:APOLLOHOSP) CEO Compensation Is Not Excessive At All

Key Insights

• Apollo Hospitals Enterprise's Annual General Meeting to take place on 30th of August
• CEO Suneeta Reddy's total compensation includes salary of ₹46.1m
• The overall pay is comparable to the industry average
• Apollo Hospitals Enterprise's EPS grew by 6.3% over the past three years while total shareholder return over the past three years was 45%

Under the guidance of CEO Suneeta Reddy, Apollo Hospitals Enterprise Limited (NSE:APOLLOHOSP) 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 30th of August. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for Apollo Hospitals Enterprise

How Does Total Compensation For Suneeta Reddy Compare With Other Companies In The Industry?

Our data indicates that Apollo Hospitals Enterprise Limited has a market capitalization of ₹986b, and total annual CEO compensation was reported as ₹76m for the year to March 2024. We note that's an increase of 13% above last year. In particular, the salary of ₹46.1m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies in the Indian Healthcare industry with market capitalizations above ₹671b, we found that the median total CEO compensation was ₹68m. This suggests that Apollo Hospitals Enterprise remunerates its CEO largely in line with the industry average. What's more, Suneeta Reddy holds ₹33b 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	₹46m	₹42m	61%
Other	₹30m	₹25m	39%
Total Compensation	₹76m	₹67m	100%

On an industry level, around 97% of total compensation represents salary and 3% is other remuneration. Apollo Hospitals Enterprise sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Apollo Hospitals Enterprise Limited's Growth Numbers

Apollo Hospitals Enterprise Limited has seen its earnings per share (EPS) increase by 6.3% a year over the past three years. In the last year, its revenue is up 14%.

We would argue that the modest growth in revenue is a notable positive. And the modest growth in EPS isn't bad, either. So while performance isn't amazing, we think it really does seem quite respectable. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Apollo Hospitals Enterprise Limited Been A Good Investment?

Most shareholders would probably be pleased with Apollo Hospitals Enterprise Limited for providing a total return of 45% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for Apollo Hospitals Enterprise that investors should look into moving forward.

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. 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.