Here's Why Shareholders May Want To Be Cautious With Increasing West Coast Paper Mills Limited's (NSE:WSTCSTPAPR) CEO Pay Packet

Key Insights

• West Coast Paper Mills will host its Annual General Meeting on 14th of August
• CEO Shree Bangur's total compensation includes salary of ₹24.0m
• The total compensation is 1,840% higher than the average for the industry
• Over the past three years, West Coast Paper Mills' EPS grew by 61% and over the past three years, the total shareholder return was 146%

Performance at West Coast Paper Mills Limited (NSE:WSTCSTPAPR) has been reasonably good and CEO Shree Bangur has done a decent job of steering the company in the right direction. 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 14th of August. However, some shareholders may still want to keep CEO compensation within reason.

View our latest analysis for West Coast Paper Mills

How Does Total Compensation For Shree Bangur Compare With Other Companies In The Industry?

Our data indicates that West Coast Paper Mills Limited has a market capitalization of ₹40b, and total annual CEO compensation was reported as ₹253m for the year to March 2024. That's a notable decrease of 21% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹24m.

On examining similar-sized companies in the Indian Forestry industry with market capitalizations between ₹17b and ₹67b, we discovered that the median CEO total compensation of that group was ₹13m. Accordingly, our analysis reveals that West Coast Paper Mills Limited pays Shree Bangur north of the industry median. Moreover, Shree Bangur also holds ₹1.8b worth of West Coast Paper Mills 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	₹24m	₹24m	10%
Other	₹229m	₹298m	90%
Total Compensation	₹253m	₹322m	100%

On an industry level, roughly 89% of total compensation represents salary and 11% is other remuneration. It's interesting to note that West Coast Paper Mills allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

West Coast Paper Mills Limited's Growth

West Coast Paper Mills Limited's earnings per share (EPS) grew 61% per year over the last three years. It saw its revenue drop 9.6% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has West Coast Paper Mills Limited Been A Good Investment?

Most shareholders would probably be pleased with West Coast Paper Mills Limited for providing a total return of 146% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar 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. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 1 warning sign for West Coast Paper Mills that investors should be aware of in a dynamic business environment.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com