We Think Shareholders Are Less Likely To Approve A Pay Rise For Indigo Paints Limited's (NSE:INDIGOPNTS) CEO For Now

Key Insights

• Indigo Paints' Annual General Meeting to take place on 30th of August
• CEO Hemant Jalan's total compensation includes salary of ₹36.0m
• The overall pay is comparable to the industry average
• Indigo Paints' EPS grew by 15% over the past three years while total shareholder loss over the past three years was 32%

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Shareholders of Indigo Paints Limited (NSE:INDIGOPNTS) will have been dismayed by the negative share price return over the last three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 30th of August. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

Check out our latest analysis for Indigo Paints

Comparing Indigo Paints Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Indigo Paints Limited has a market capitalization of ₹54b, and reported total annual CEO compensation of ₹36m for the year to March 2025. That's a notable increase of 50% on last year. Notably, the salary of ₹36m is the entirety of the CEO compensation.

In comparison with other companies in the Indian Chemicals industry with market capitalizations ranging from ₹35b to ₹140b, the reported median CEO total compensation was ₹36m. From this we gather that Hemant Jalan is paid around the median for CEOs in the industry. Furthermore, Hemant Jalan directly owns ₹16b worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 84% of total compensation represents salary and 16% is other remuneration. On a company level, Indigo Paints prefers to reward its CEO through a salary, opting not to pay Hemant Jalan through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Indigo Paints Limited's Growth

Indigo Paints Limited has seen its earnings per share (EPS) increase by 15% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Indigo Paints Limited Been A Good Investment?

The return of -32% over three years would not have pleased Indigo Paints Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Indigo Paints rewards its CEO solely through a salary, ignoring non-salary benefits completely. The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

Shareholders may want to check for free if Indigo Paints insiders are buying or selling shares.

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.