Dynemic Products Limited's (NSE:DYNPRO) CEO Compensation Is Looking A Bit Stretched At The Moment

Performance at Dynemic Products Limited (NSE:DYNPRO) has been reasonably good and CEO Bhagwandas Patel has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 29 September 2022, 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.

Check out our latest analysis for Dynemic Products

Comparing Dynemic Products Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Dynemic Products Limited has a market capitalization of ₹3.5b, and reported total annual CEO compensation of ₹12m for the year to March 2022. That's a notable decrease of 24% on last year. We note that the salary of ₹6.49m makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations below ₹16b, reported a median total CEO compensation of ₹6.8m. This suggests that Bhagwandas Patel is paid more than the median for the industry. Moreover, Bhagwandas Patel also holds ₹381m worth of Dynemic Products stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	₹6.5m	₹7.2m	56%
Other	₹5.1m	₹8.0m	44%
Total Compensation	₹12m	₹15m	100%

Speaking on an industry level, nearly 86% of total compensation represents salary, while the remainder of 14% is other remuneration. Dynemic Products pays a modest slice of remuneration through salary, as compared to the broader 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.

Dynemic Products Limited's Growth

Over the last three years, Dynemic Products Limited has shrunk its earnings per share by 13% per year. In the last year, its revenue is up 16%.

Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Dynemic Products Limited Been A Good Investment?

Boasting a total shareholder return of 144% over three years, Dynemic Products 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...

Although the company has performed relatively well, we still think there are some areas that could be improved. Until EPS growth picks back up, we think shareholders may find it hard to justify increasing CEO pay given that they are already paid above industry average.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 5 warning signs for Dynemic Products you should be aware of, and 2 of them make us uncomfortable.

Important note: Dynemic Products is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.