Why We Think The CEO Of Agarwal Industrial Corporation Limited (NSE:AGARIND) May Soon See A Pay Rise

Key Insights

• Agarwal Industrial to hold its Annual General Meeting on 15th of September
• CEO Jaiprakash Agarwal's total compensation includes salary of ₹7.50m
• The total compensation is 65% less than the average for the industry
• Over the past three years, Agarwal Industrial's EPS grew by 42% and over the past three years, the total shareholder return was 923%

Shareholders will be pleased by the impressive results for Agarwal Industrial Corporation Limited (NSE:AGARIND) recently and CEO Jaiprakash Agarwal has played a key role. At the upcoming AGM on 15th of September, they will get a chance to hear the board review the company results, discuss future strategy and cast their vote on any resolutions such as executive remuneration. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

See our latest analysis for Agarwal Industrial

Comparing Agarwal Industrial Corporation Limited's CEO Compensation With The Industry

According to our data, Agarwal Industrial Corporation Limited has a market capitalization of ₹15b, and paid its CEO total annual compensation worth ₹7.5m over the year to March 2023. Notably, that's an increase of 25% over the year before. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹7.5m.

On comparing similar companies from the Indian Chemicals industry with market caps ranging from ₹8.3b to ₹33b, we found that the median CEO total compensation was ₹22m. This suggests that Jaiprakash Agarwal is paid below the industry median. What's more, Jaiprakash Agarwal holds ₹1.1b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	₹7.5m	₹6.0m	100%
Other	-	-	-
Total Compensation	₹7.5m	₹6.0m	100%

On an industry level, roughly 86% of total compensation represents salary and 14% is other remuneration. On a company level, Agarwal Industrial prefers to reward its CEO through a salary, opting not to pay Jaiprakash Agarwal through non-salary benefits. 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 Agarwal Industrial Corporation Limited's Growth Numbers

Over the past three years, Agarwal Industrial Corporation Limited has seen its earnings per share (EPS) grow by 42% per year. In the last year, its revenue is up 16%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Agarwal Industrial Corporation Limited Been A Good Investment?

Boasting a total shareholder return of 923% over three years, Agarwal Industrial Corporation Limited has done well by shareholders. 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...

Agarwal Industrial rewards its CEO solely through a salary, ignoring non-salary benefits completely. The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

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 2 warning signs for Agarwal Industrial 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.