How Much is Bajaj Finserv's (NSE:BAJAJFINSV) CEO Getting Paid?

Sanjiv Bajaj has been the CEO of Bajaj Finserv Ltd. (NSE:BAJAJFINSV) since 2008, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Bajaj Finserv pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Bajaj Finserv

Comparing Bajaj Finserv Ltd.'s CEO Compensation With the industry

At the time of writing, our data shows that Bajaj Finserv Ltd. has a market capitalization of ₹1.6t, and reported total annual CEO compensation of ₹108m for the year to March 2020. Notably, that's an increase of 37% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹28m.

In comparison with other companies in the industry with market capitalizations over ₹583b , the reported median total CEO compensation was ₹80m. This suggests that Sanjiv Bajaj is paid more than the median for the industry. Moreover, Sanjiv Bajaj also holds ₹4.2b worth of Bajaj Finserv stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 52% of total compensation represents salary, while the remainder of 48% is other remuneration. Bajaj Finserv pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Bajaj Finserv Ltd.'s Growth

Over the past three years, Bajaj Finserv Ltd. has seen its earnings per share (EPS) grow by 12% per year. In the last year, its revenue is up 8.5%.

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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Bajaj Finserv Ltd. Been A Good Investment?

Most shareholders would probably be pleased with Bajaj Finserv Ltd. for providing a total return of 92% 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...

As previously discussed, Sanjiv is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, Bajaj Finserv has produced strong EPS growth and shareholder returns over the last three years. As a result of the excellent all-round performance of the company, we believe CEO compensation is fair. And given most shareholders are probably very happy with recent returns, they might even think that Sanjiv deserves a raise!

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 3 warning signs for Bajaj Finserv (1 doesn't sit too well with us!) 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.

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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.
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