We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Shalimar Paints Limited's (NSE:SHALPAINTS) CEO For Now

Key Insights

• Shalimar Paints will host its Annual General Meeting on 27th of September
• CEO Ashok Gupta's total compensation includes salary of ₹25.0m
• Total compensation is 318% above industry average
• Shalimar Paints' EPS grew by 13% over the past three years while total shareholder return over the past three years was 140%

Under the guidance of CEO Ashok Gupta, Shalimar Paints Limited (NSE:SHALPAINTS) 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 27th of September. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Shalimar Paints

How Does Total Compensation For Ashok Gupta Compare With Other Companies In The Industry?

At the time of writing, our data shows that Shalimar Paints Limited has a market capitalization of ₹11b, and reported total annual CEO compensation of ₹25m for the year to March 2023. This was the same as last year. Notably, the salary of ₹25m is the entirety of the CEO compensation.

For comparison, other companies in the Indian Chemicals industry with market capitalizations below ₹17b, reported a median total CEO compensation of ₹6.0m. This suggests that Ashok Gupta is paid more than the median for the industry. What's more, Ashok Gupta holds ₹287m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	₹25m	₹25m	100%
Other	-	-	-
Total Compensation	₹25m	₹25m	100%

Speaking on an industry level, nearly 86% of total compensation represents salary, while the remainder of 14% is other remuneration. On a company level, Shalimar Paints prefers to reward its CEO through a salary, opting not to pay Ashok Gupta through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Shalimar Paints Limited's Growth

Over the past three years, Shalimar Paints Limited has seen its earnings per share (EPS) grow by 13% per year. Its revenue is up 24% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Shalimar Paints Limited Been A Good Investment?

Boasting a total shareholder return of 140% over three years, Shalimar Paints 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.

In Summary...

Shalimar Paints 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 can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Shalimar Paints that you should be aware of before investing.

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.