Zee Entertainment Enterprises Limited's (NSE:ZEEL) CEO Might Not Expect Shareholders To Be So Generous This Year

Key Insights

• Zee Entertainment Enterprises' Annual General Meeting to take place on 28th of November
• Salary of ₹147.1m is part of CEO Punit Goenka's total remuneration
• The overall pay is 1,740% above the industry average
• Zee Entertainment Enterprises' EPS declined by 30% over the past three years while total shareholder loss over the past three years was 65%

Shareholders will probably not be too impressed with the underwhelming results at Zee Entertainment Enterprises Limited (NSE:ZEEL) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 28th of November. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Zee Entertainment Enterprises

How Does Total Compensation For Punit Goenka Compare With Other Companies In The Industry?

At the time of writing, our data shows that Zee Entertainment Enterprises Limited has a market capitalization of ₹114b, and reported total annual CEO compensation of ₹197m for the year to March 2024. Notably, that's a decrease of 44% over the year before. In particular, the salary of ₹147.1m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the Indian Media industry with market capitalizations between ₹84b and ₹270b, we discovered that the median CEO total compensation of that group was ₹11m. This suggests that Punit Goenka is paid more than the median for the industry.

Component	2024	2023	Proportion (2024)
Salary	₹147m	₹210m	75%
Other	₹50m	₹141m	25%
Total Compensation	₹197m	₹351m	100%

Speaking on an industry level, nearly 92% of total compensation represents salary, while the remainder of 8% is other remuneration. Zee Entertainment Enterprises sets aside a smaller share of compensation for salary, in comparison to the overall industry. 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.

Zee Entertainment Enterprises Limited's Growth

Zee Entertainment Enterprises Limited has reduced its earnings per share by 30% a year over the last three years. Its revenue is down 4.2% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Zee Entertainment Enterprises Limited Been A Good Investment?

The return of -65% over three years would not have pleased Zee Entertainment Enterprises Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

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 Zee Entertainment Enterprises that investors should think about before committing capital to this stock.

Important note: Zee Entertainment Enterprises 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.