Here's Why Shareholders Should Examine Jocil Limited's (NSE:JOCIL) CEO Compensation Package More Closely

Key Insights

• Jocil's Annual General Meeting to take place on 19th of September
• Total pay for CEO Jagarlamudi Mohan includes ₹10.9m salary
• Total compensation is 303% above industry average
• Jocil's three-year loss to shareholders was 6.6% while its EPS was down 41% over the past three years

Shareholders will probably not be too impressed with the underwhelming results at Jocil Limited (NSE:JOCIL) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 19th of September. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Jocil

Comparing Jocil Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Jocil Limited has a market capitalization of ₹2.0b, and reported total annual CEO compensation of ₹23m for the year to March 2024. This was the same as last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹11m.

In comparison with other companies in the Indian Chemicals industry with market capitalizations under ₹17b, the reported median total CEO compensation was ₹5.8m. Hence, we can conclude that Jagarlamudi Mohan is remunerated higher than the industry median. Furthermore, Jagarlamudi Mohan directly owns ₹5.0m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2024	Proportion (2024)
Salary	₹11m	₹11m	47%
Other	₹12m	₹12m	53%
Total Compensation	₹23m	₹23m	100%

On an industry level, roughly 89% of total compensation represents salary and 11% is other remuneration. Jocil 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.

Jocil Limited's Growth

Over the last three years, Jocil Limited has shrunk its earnings per share by 41% per year. Revenue was pretty flat on last year.

The decline in EPS is a bit concerning. And the flat revenue is seriously uninspiring. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Jocil Limited Been A Good Investment?

With a three year total loss of 6.6% for the shareholders, Jocil Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 4 warning signs for Jocil you should be aware of, and 1 of them is concerning.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.