We Take A Look At Why Genus Paper & Boards Limited's (NSE:GENUSPAPER) CEO Compensation Is Well Earned

It would be hard to discount the role that CEO Kailash Agarwal has played in delivering the impressive results at Genus Paper & Boards Limited (NSE:GENUSPAPER) recently. Coming up to the next AGM on 27 September 2022, shareholders would be keeping this in mind. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

View our latest analysis for Genus Paper & Boards

How Does Total Compensation For Kailash Agarwal Compare With Other Companies In The Industry?

At the time of writing, our data shows that Genus Paper & Boards Limited has a market capitalization of ₹4.2b, and reported total annual CEO compensation of ₹7.4m for the year to March 2022. This was the same amount the CEO received in the prior year. In particular, the salary of ₹6.72m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under ₹16b, the reported median total CEO compensation was ₹6.3m. From this we gather that Kailash Agarwal is paid around the median for CEOs in the industry. Furthermore, Kailash Agarwal directly owns ₹249m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2022	2021	Proportion (2022)
Salary	₹6.7m	₹6.7m	91%
Other	₹650k	₹650k	9%
Total Compensation	₹7.4m	₹7.4m	100%

On an industry level, around 90% of total compensation represents salary and 10% is other remuneration. Genus Paper & Boards is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Genus Paper & Boards Limited's Growth Numbers

Genus Paper & Boards Limited has seen its earnings per share (EPS) increase by 80% a year over the past three years. It achieved revenue growth of 93% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Genus Paper & Boards Limited Been A Good Investment?

Most shareholders would probably be pleased with Genus Paper & Boards Limited for providing a total return of 139% over three years. 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.

In Summary...

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. 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 compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for Genus Paper & Boards that investors should look into moving forward.

Important note: Genus Paper & Boards 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.