Increases to CEO Compensation Might Be Put On Hold For Now at Ruchira Papers Limited (NSE:RUCHIRA)

Under the guidance of CEO Umesh Garg, Ruchira Papers Limited (NSE:RUCHIRA) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 29 September 2022. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Ruchira Papers

How Does Total Compensation For Umesh Garg Compare With Other Companies In The Industry?

According to our data, Ruchira Papers Limited has a market capitalization of ₹3.7b, and paid its CEO total annual compensation worth ₹23m over the year to March 2022. This was the same amount the CEO received in the prior year. Notably, the salary of ₹23m is the entirety of the CEO compensation.

For comparison, other companies in the industry with market capitalizations below ₹16b, reported a median total CEO compensation of ₹6.3m. Hence, we can conclude that Umesh Garg is remunerated higher than the industry median. Moreover, Umesh Garg also holds ₹350m worth of Ruchira Papers stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	₹23m	₹23m	100%
Other	-	-	-
Total Compensation	₹23m	₹23m	100%

On an industry level, around 90% of total compensation represents salary and 10% is other remuneration. On a company level, Ruchira Papers prefers to reward its CEO through a salary, opting not to pay Umesh Garg through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Ruchira Papers Limited's Growth

Over the last three years, Ruchira Papers Limited has shrunk its earnings per share by 4.2% per year. Its revenue is up 42% over the last year.

The decrease in EPS could be a concern for some investors. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 Ruchira Papers Limited Been A Good Investment?

We think that the total shareholder return of 41%, over three years, would leave most Ruchira Papers Limited shareholders smiling. 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...

Ruchira Papers pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Some shareholders will be pleased by the relatively good results, however, the results could still be improved. Until EPS growth picks back up, we think shareholders may find it hard to justify increasing CEO pay given that they are already paid above industry average.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 5 warning signs for Ruchira Papers you should be aware of, and 2 of them are a bit 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.