It's Unlikely That Castrol India Limited's (NSE:CASTROLIND) CEO Will See A Huge Pay Rise This Year

Key Insights

• Castrol India will host its Annual General Meeting on 28th of March
• Salary of ₹26.6m is part of CEO Sandeep Sangwan's total remuneration
• Total compensation is 104% above industry average
• Over the past three years, Castrol India's EPS grew by 14% and over the past three years, the total shareholder return was 87%

Performance at Castrol India Limited (NSE:CASTROLIND) has been reasonably good and CEO Sandeep Sangwan has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 28th of March, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Castrol India

Comparing Castrol India Limited's CEO Compensation With The Industry

According to our data, Castrol India Limited has a market capitalization of ₹191b, and paid its CEO total annual compensation worth ₹94m over the year to December 2023. Notably, that's an increase of 99% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹27m.

For comparison, other companies in the Indian Chemicals industry with market capitalizations ranging between ₹83b and ₹266b had a median total CEO compensation of ₹46m. Hence, we can conclude that Sandeep Sangwan is remunerated higher than the industry median.

Component	2023	2022	Proportion (2023)
Salary	₹27m	₹24m	28%
Other	₹67m	₹23m	72%
Total Compensation	₹94m	₹47m	100%

Speaking on an industry level, nearly 86% of total compensation represents salary, while the remainder of 14% is other remuneration. Castrol India sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Castrol India Limited's Growth

Over the past three years, Castrol India Limited has seen its earnings per share (EPS) grow by 14% per year. It achieved revenue growth of 6.3% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 Castrol India Limited Been A Good Investment?

Boasting a total shareholder return of 87% over three years, Castrol India Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for Castrol India that investors should look into moving forward.

Switching gears from Castrol India, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.