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Pendyala Chowdary has been the CEO of The Andhra Sugars Limited (NSE:ANDHRSUGAR) since 2012. First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Pendyala Chowdary’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that The Andhra Sugars Limited has a market cap of ₹8.6b, and is paying total annual CEO compensation of ₹40m. (This figure is for the year to March 2018). While we always look at total compensation first, we note that the salary component is less, at ₹7.5m. We examined a group of similar sized companies, with market capitalizations of below ₹14b. The median CEO total compensation in that group is ₹1.3m.
It would therefore appear that The Andhra Sugars Limited pays Pendyala Chowdary more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Andhra Sugars has changed over time.
Is The Andhra Sugars Limited Growing?
The Andhra Sugars Limited has increased its earnings per share (EPS) by an average of 35% a year, over the last three years (using a line of best fit). Its revenue is up 5.3% over last year.
This demonstrates that the company has been improving recently. A good result. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions.
Has The Andhra Sugars Limited Been A Good Investment?
The Andhra Sugars Limited has generated a total shareholder return of 29% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared the total CEO remuneration paid by The Andhra Sugars Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. We also think investors are doing ok, over the same time period. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Andhra Sugars.
If you want to buy a stock that is better than Andhra Sugars, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.