It's Unlikely That Ruchira Papers Limited's (NSE:RUCHIRA) CEO Will See A Huge Pay Rise This Year

Key Insights

• Ruchira Papers will host its Annual General Meeting on 24th of September
• Salary of ₹26.6m is part of CEO Umesh Garg's total remuneration
• The overall pay is 354% above the industry average
• Over the past three years, Ruchira Papers' EPS grew by 39% and over the past three years, the total shareholder return was 109%

Performance at Ruchira Papers Limited (NSE:RUCHIRA) has been reasonably good and CEO Umesh Garg 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 24th of September. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Ruchira Papers

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

Our data indicates that Ruchira Papers Limited has a market capitalization of ₹4.2b, and total annual CEO compensation was reported as ₹27m for the year to March 2024. We note that's an increase of 16% above last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹27m.

In comparison with other companies in the Indian Forestry industry with market capitalizations under ₹17b, the reported median total CEO compensation was ₹5.9m. This suggests that Umesh Garg is paid more than the median for the industry. Moreover, Umesh Garg also holds ₹403m 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	2024	2023	Proportion (2024)
Salary	₹27m	₹23m	100%
Other	-	-	-
Total Compensation	₹27m	₹23m	100%

On an industry level, roughly 90% of total compensation represents salary and 10% is other remuneration. At the company level, Ruchira Papers pays Umesh Garg solely through a salary, preferring to go down a conventional route. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Ruchira Papers Limited's Growth

Ruchira Papers Limited's earnings per share (EPS) grew 39% per year over the last three years. In the last year, its revenue is down 16%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Ruchira Papers Limited Been A Good Investment?

Boasting a total shareholder return of 109% over three years, Ruchira Papers Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Ruchira Papers rewards its CEO solely through a salary, ignoring non-salary benefits completely. 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.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 3 warning signs for Ruchira Papers that you should be aware of before investing.

Important note: Ruchira Papers 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.