Increases to Plastiblends India Limited's (NSE:PLASTIBLEN) CEO Compensation Might Cool off for now

Key Insights

• Plastiblends India to hold its Annual General Meeting on 15th of July
• Total pay for CEO Satyanarayan Gopilal Kabra includes ₹9.00m salary
• The overall pay is 145% above the industry average
• Plastiblends India's EPS declined by 3.1% over the past three years while total shareholder return over the past three years was 7.2%

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The share price of Plastiblends India Limited (NSE:PLASTIBLEN) has been growing in the past few years, however, the per-share earnings growth has been lacking, suggesting something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 15th of July. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

View our latest analysis for Plastiblends India

How Does Total Compensation For Satyanarayan Gopilal Kabra Compare With Other Companies In The Industry?

According to our data, Plastiblends India Limited has a market capitalization of ₹5.5b, and paid its CEO total annual compensation worth ₹15m over the year to March 2025. That's a fairly small increase of 7.6% over the previous year. Notably, the salary which is ₹9.00m, represents most of the total compensation being paid.

On comparing similar-sized companies in the Indian Chemicals industry with market capitalizations below ₹17b, we found that the median total CEO compensation was ₹6.0m. This suggests that Satyanarayan Gopilal Kabra is paid more than the median for the industry. Moreover, Satyanarayan Gopilal Kabra also holds ₹145m worth of Plastiblends India stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 88% of total compensation represents salary and 12% is other remuneration. In Plastiblends India's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Plastiblends India Limited's Growth

Plastiblends India Limited has reduced its earnings per share by 3.1% a year over the last three years. It saw its revenue drop 2.7% over the last year.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Plastiblends India Limited Been A Good Investment?

Plastiblends India Limited has not done too badly by shareholders, with a total return of 7.2%, over three years. It would be nice to see that metric improve in the future. Accordingly, a proposal to increase CEO remuneration without seeing an improvement in shareholder returns might not be met favorably by most shareholders.

To Conclude...

Shareholder returns, while positive, should be looked at along with earnings, which have not grown at all recently. This makes us think the share price momentum may slow in the future. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Plastiblends India (of which 1 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Important note: Plastiblends India 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.