We Take A Look At Why Indraprastha Medical Corporation Limited's (NSE:INDRAMEDCO) CEO Compensation Is Well Earned

Key Insights

• Indraprastha Medical will host its Annual General Meeting on 24th of September
• Salary of ₹25.2m is part of CEO Shivakumar Pattabhiraman's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, Indraprastha Medical's EPS grew by 48% and over the past three years, the total shareholder return was 526%

It would be hard to discount the role that CEO Shivakumar Pattabhiraman has played in delivering the impressive results at Indraprastha Medical Corporation Limited (NSE:INDRAMEDCO) recently. Coming up to the next AGM on 24th of September, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

View our latest analysis for Indraprastha Medical

How Does Total Compensation For Shivakumar Pattabhiraman Compare With Other Companies In The Industry?

According to our data, Indraprastha Medical Corporation Limited has a market capitalization of ₹42b, and paid its CEO total annual compensation worth ₹26m over the year to March 2024. Notably, that's an increase of 8.3% over the year before. In particular, the salary of ₹25.2m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the Indian Healthcare industry with market capitalizations between ₹17b and ₹67b, we discovered that the median CEO total compensation of that group was ₹33m. This suggests that Indraprastha Medical remunerates its CEO largely in line with the industry average.

Component	2024	2023	Proportion (2024)
Salary	₹25m	₹23m	96%
Other	₹1.0m	₹821k	4%
Total Compensation	₹26m	₹24m	100%

On an industry level, roughly 91% of total compensation represents salary and 9% is other remuneration. Indraprastha Medical is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Indraprastha Medical Corporation Limited's Growth

Indraprastha Medical Corporation Limited's earnings per share (EPS) grew 48% per year over the last three years. It achieved revenue growth of 13% 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 decent revenue growth in the last year, suggesting the business is healthy and growing. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Indraprastha Medical Corporation Limited Been A Good Investment?

Boasting a total shareholder return of 526% over three years, Indraprastha Medical Corporation Limited has done well by shareholders. 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...

Shivakumar receives almost all of their compensation through a salary. Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Indraprastha Medical that you should be aware of before investing.

Important note: Indraprastha Medical 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.