How Is Tainwala Chemicals and Plastics (India)'s (NSE:TAINWALCHM) CEO Paid Relative To Peers?

The CEO of Tainwala Chemicals and Plastics (India) Limited (NSE:TAINWALCHM) is Rakesh Tainwala, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Tainwala Chemicals and Plastics (India).

Check out our latest analysis for Tainwala Chemicals and Plastics (India)

How Does Total Compensation For Rakesh Tainwala Compare With Other Companies In The Industry?

According to our data, Tainwala Chemicals and Plastics (India) Limited has a market capitalization of ₹424m, and paid its CEO total annual compensation worth ₹7.4m over the year to March 2020. We note that's an increase of 14% above last year. In particular, the salary of ₹6.00m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below ₹15b, reported a median total CEO compensation of ₹7.0m. This suggests that Tainwala Chemicals and Plastics (India) remunerates its CEO largely in line with the industry average.

Talking in terms of the industry, salary represented approximately 89% of total compensation out of all the companies we analyzed, while other remuneration made up 11% of the pie. Tainwala Chemicals and Plastics (India) is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Tainwala Chemicals and Plastics (India) Limited's Growth Numbers

Tainwala Chemicals and Plastics (India) Limited has reduced its earnings per share by 31% a year over the last three years. In the last year, its revenue is down 39%.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet 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 Tainwala Chemicals and Plastics (India) Limited Been A Good Investment?

With a three year total loss of 61% for the shareholders, Tainwala Chemicals and Plastics (India) Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As previously discussed, Rakesh is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, EPS growth and shareholder returns have been in the red for the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.

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. We identified 3 warning signs for Tainwala Chemicals and Plastics (India) (1 can't be ignored!) that you should be aware of before investing here.

Switching gears from Tainwala Chemicals and Plastics (India), if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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This article by Simply Wall St is general in nature. 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.
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