Shareholders Will Probably Hold Off On Increasing Pokarna Limited's (NSE:POKARNA) CEO Compensation For The Time Being

Key Insights

• Pokarna's Annual General Meeting to take place on 30th of September
• Total pay for CEO Gautam Chand Jain includes ₹18.0m salary
• Total compensation is 110% above industry average
• Pokarna's total shareholder return over the past three years was 129% while its EPS grew by 37% over the past three years

Performance at Pokarna Limited (NSE:POKARNA) has been reasonably good and CEO Gautam Chand Jain 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 30th of September. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Pokarna

How Does Total Compensation For Gautam Chand Jain Compare With Other Companies In The Industry?

At the time of writing, our data shows that Pokarna Limited has a market capitalization of ₹34b, and reported total annual CEO compensation of ₹81m for the year to March 2024. Notably, that's an increase of 62% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹18m.

On comparing similar companies from the Indian Basic Materials industry with market caps ranging from ₹17b to ₹67b, we found that the median CEO total compensation was ₹39m. This suggests that Gautam Chand Jain is paid more than the median for the industry. Furthermore, Gautam Chand Jain directly owns ₹18b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹18m	₹18m	22%
Other	₹63m	₹32m	78%
Total Compensation	₹81m	₹50m	100%

On an industry level, roughly 84% of total compensation represents salary and 16% is other remuneration. In Pokarna's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Pokarna Limited's Growth

Pokarna Limited's earnings per share (EPS) grew 37% per year over the last three years. It achieved revenue growth of 10% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Pokarna Limited Been A Good Investment?

Boasting a total shareholder return of 129% over three years, Pokarna Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same 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. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for Pokarna that investors should look into moving forward.

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.