Increases to Entertainment Network (India) Limited's (NSE:ENIL) CEO Compensation Might Cool off for now

In the past three years, the share price of Entertainment Network (India) Limited (NSE:ENIL) has struggled to grow and now shareholders are sitting on a loss. Per share earnings growth is also poor, despite revenues growing. Shareholders will have a chance to take their concerns to the board at the next AGM on 27 September 2022 and vote on resolutions including executive compensation, which studies show may have an impact on company performance. Here's why we think shareholders should hold off on a raise for the CEO at the moment.

Check out our latest analysis for Entertainment Network (India)

How Does Total Compensation For Prashant Panday Compare With Other Companies In The Industry?

Our data indicates that Entertainment Network (India) Limited has a market capitalization of ₹8.3b, and total annual CEO compensation was reported as ₹32m for the year to March 2022. Notably, that's an increase of 40% over the year before. In particular, the salary of ₹31.1m, 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 ₹16b, reported a median total CEO compensation of ₹10m. Accordingly, our analysis reveals that Entertainment Network (India) Limited pays Prashant Panday north of the industry median. Furthermore, Prashant Panday directly owns ₹3.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2022	2021	Proportion (2022)
Salary	₹31m	₹22m	96%
Other	₹1.2m	₹806k	4%
Total Compensation	₹32m	₹23m	100%

Speaking on an industry level, nearly 100% of total compensation represents salary, while the remainder of 0.2491% is other remuneration. Entertainment Network (India) is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Entertainment Network (India) Limited's Growth Numbers

Over the last three years, Entertainment Network (India) Limited has shrunk its earnings per share by 72% per year. Its revenue is up 39% over the last year.

The reduction in EPS, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Entertainment Network (India) Limited Been A Good Investment?

With a total shareholder return of -50% over three years, Entertainment Network (India) Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Entertainment Network (India) pays its CEO a majority of compensation through a salary. The loss to shareholders over the past three years is certainly concerning and possibly has something to do with the fact that the company's earnings haven't grown. In the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan is in line with their expectations.

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 Entertainment Network (India) that investors should think about before committing capital to this stock.

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.