Maithan Alloys Limited's (NSE:MAITHANALL) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Maithan Alloys will host its Annual General Meeting on 26th of September
• Salary of ₹7.20m is part of CEO Subodh Agarwalla's total remuneration
• The overall pay is 372% above the industry average
• Maithan Alloys' EPS grew by 18% over the past three years while total shareholder return over the past three years was 115%

Performance at Maithan Alloys Limited (NSE:MAITHANALL) has been reasonably good and CEO Subodh Agarwalla has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 26th of September. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for Maithan Alloys

How Does Total Compensation For Subodh Agarwalla Compare With Other Companies In The Industry?

Our data indicates that Maithan Alloys Limited has a market capitalization of ₹31b, and total annual CEO compensation was reported as ₹123m for the year to March 2023. We note that's a decrease of 46% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹7.2m.

On examining similar-sized companies in the Indian Metals and Mining industry with market capitalizations between ₹17b and ₹67b, we discovered that the median CEO total compensation of that group was ₹26m. Hence, we can conclude that Subodh Agarwalla is remunerated higher than the industry median. Moreover, Subodh Agarwalla also holds ₹704m worth of Maithan Alloys stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	₹7.2m	₹7.2m	6%
Other	₹116m	₹221m	94%
Total Compensation	₹123m	₹228m	100%

On an industry level, around 100% of total compensation represents salary and 0.0956% is other remuneration. In Maithan Alloys' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Maithan Alloys Limited's Growth

Over the past three years, Maithan Alloys Limited has seen its earnings per share (EPS) grow by 18% per year. In the last year, its revenue is down 34%.

Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Maithan Alloys Limited Been A Good Investment?

Most shareholders would probably be pleased with Maithan Alloys Limited for providing a total return of 115% 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.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Maithan Alloys that investors should think about before committing capital to this stock.

Important note: Maithan Alloys 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.