Bajaj Consumer Care Limited's (NSE:BAJAJCON) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Bajaj Consumer Care to hold its Annual General Meeting on 9th of August
• Total pay for CEO Jaideep Nandi includes ₹57.2m salary
• The overall pay is 160% above the industry average
• Bajaj Consumer Care's EPS declined by 10% over the past three years while total shareholder return over the past three years was 6.6%

The share price of Bajaj Consumer Care Limited (NSE:BAJAJCON) has been growing in the past few years, however, the per-share earnings growth has been lacking, suggesting something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 9th of August. They will be able to influence managerial decisions through the exercise of their voting power on resolutions, such as CEO remuneration and other matters, which may influence future company prospects. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

Check out our latest analysis for Bajaj Consumer Care

Comparing Bajaj Consumer Care Limited's CEO Compensation With The Industry

Our data indicates that Bajaj Consumer Care Limited has a market capitalization of ₹38b, and total annual CEO compensation was reported as ₹57m for the year to March 2024. We note that's an increase of 34% above last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹57m.

On comparing similar companies from the Indian Personal Products industry with market caps ranging from ₹17b to ₹67b, we found that the median CEO total compensation was ₹22m. Accordingly, our analysis reveals that Bajaj Consumer Care Limited pays Jaideep Nandi north of the industry median. Furthermore, Jaideep Nandi directly owns ₹38m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹57m	₹43m	100%
Other	-	-	-
Total Compensation	₹57m	₹43m	100%

Speaking on an industry level, nearly 95% of total compensation represents salary, while the remainder of 5% is other remuneration. At the company level, Bajaj Consumer Care pays Jaideep Nandi solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Bajaj Consumer Care Limited's Growth

Over the last three years, Bajaj Consumer Care Limited has shrunk its earnings per share by 10% per year. It achieved revenue growth of 2.4% over the last year.

Few shareholders would be pleased to read that EPS have declined. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Bajaj Consumer Care Limited Been A Good Investment?

Bajaj Consumer Care Limited has generated a total shareholder return of 6.6% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

In Summary...

Bajaj Consumer Care pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. While it's true that shareholders have owned decent returns, it's hard to overlook the lack of earnings growth and this makes us question whether these returns will continue. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Bajaj Consumer Care that investors should look into moving forward.

Important note: Bajaj Consumer Care 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.

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