Godawari Power & Ispat Limited's (NSE:GPIL) CEO Looks Like They Deserve Their Pay Packet

The performance at Godawari Power & Ispat Limited (NSE:GPIL) has been quite strong recently and CEO Bajrang Agrawal has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 28 August 2021. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and 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.

See our latest analysis for Godawari Power & Ispat

How Does Total Compensation For Bajrang Agrawal Compare With Other Companies In The Industry?

According to our data, Godawari Power & Ispat Limited has a market capitalization of ₹44b, and paid its CEO total annual compensation worth ₹24m over the year to March 2021. This was the same amount the CEO received in the prior year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹24m.

On examining similar-sized companies in the industry with market capitalizations between ₹15b and ₹59b, we discovered that the median CEO total compensation of that group was ₹23m. So it looks like Godawari Power & Ispat compensates Bajrang Agrawal in line with the median for the industry. Moreover, Bajrang Agrawal also holds ₹7.4b worth of Godawari Power & Ispat stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	₹24m	₹24m	100%
Other	-	-	-
Total Compensation	₹24m	₹24m	100%

On an industry level, roughly 100% of total compensation represents salary and 0.304% is other remuneration. Speaking on a company level, Godawari Power & Ispat prefers to tread along a traditional path, disbursing all compensation through a salary. 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.

Godawari Power & Ispat Limited's Growth

Godawari Power & Ispat Limited has seen its earnings per share (EPS) increase by 58% a year over the past three years. In the last year, its revenue is up 43%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Godawari Power & Ispat Limited Been A Good Investment?

Boasting a total shareholder return of 140% over three years, Godawari Power & Ispat 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.

To Conclude...

Godawari Power & Ispat pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. 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 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. That's why we did some digging and identified 4 warning signs for Godawari Power & Ispat that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.
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