Why We Think Shareholders May Be Considering Bumping Up General Insurance Corporation of India's (NSE:GICRE) CEO Compensation

Key Insights

• General Insurance Corporation of India's Annual General Meeting to take place on 26th of September
• CEO Devesh Srivastava's total compensation includes salary of ₹4.41m
• The overall pay is 93% below the industry average
• General Insurance Corporation of India's EPS grew by 77% over the past three years while total shareholder return over the past three years was 98%

The solid performance at General Insurance Corporation of India (NSE:GICRE) has been impressive and shareholders will probably be pleased to know that CEO Devesh Srivastava has delivered. At the upcoming AGM on 26th of September, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

Check out our latest analysis for General Insurance Corporation of India

How Does Total Compensation For Devesh Srivastava Compare With Other Companies In The Industry?

At the time of writing, our data shows that General Insurance Corporation of India has a market capitalization of ₹406b, and reported total annual CEO compensation of ₹5.3m for the year to March 2023. That's a notable increase of 30% on last year. Notably, the salary which is ₹4.41m, represents most of the total compensation being paid.

On comparing similar companies from the Indian Insurance industry with market caps ranging from ₹333b to ₹999b, we found that the median CEO total compensation was ₹71m. Accordingly, General Insurance Corporation of India pays its CEO under the industry median.

Component	2023	2021	Proportion (2023)
Salary	₹4.4m	₹3.1m	83%
Other	₹889k	₹965k	17%
Total Compensation	₹5.3m	₹4.1m	100%

On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. According to our research, General Insurance Corporation of India has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at General Insurance Corporation of India's Growth Numbers

General Insurance Corporation of India's earnings per share (EPS) grew 77% per year over the last three years. It saw its revenue drop 7.7% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has General Insurance Corporation of India Been A Good Investment?

Most shareholders would probably be pleased with General Insurance Corporation of India for providing a total return of 98% over three years. 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...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for General Insurance Corporation of India you should be aware of, and 1 of them shouldn't be ignored.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.