Our View On Eris Lifesciences' (NSE:ERIS) CEO Pay

The CEO of Eris Lifesciences Limited (NSE:ERIS) is Amit Bakshi, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Eris Lifesciences

How Does Total Compensation For Amit Bakshi Compare With Other Companies In The Industry?

According to our data, Eris Lifesciences Limited has a market capitalization of ₹79b, and paid its CEO total annual compensation worth ₹49m over the year to March 2020. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₹18m.

On comparing similar companies from the same industry with market caps ranging from ₹29b to ₹117b, we found that the median CEO total compensation was ₹28m. This suggests that Amit Bakshi is paid more than the median for the industry. Furthermore, Amit Bakshi directly owns ₹31b worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 99% of total compensation represents salary and 1.2% is other remuneration. In Eris Lifesciences' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Eris Lifesciences Limited's Growth

Eris Lifesciences Limited has seen its earnings per share (EPS) increase by 5.3% a year over the past three years. In the last year, its revenue is up 11%.

We think the revenue growth is good. And the improvement in EPSis modest but respectable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Eris Lifesciences Limited Been A Good Investment?

Given the total shareholder loss of 26% over three years, many shareholders in Eris Lifesciences Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As we noted earlier, Eris Lifesciences pays its CEO higher than the norm for similar-sized companies belonging to the same industry. While we have not been overly impressed by the business performance, the shareholder returns have been utterly depressing, over the last three years. This doesn't look great when you consider Amit is taking home compensation north of the industry average. With such poor returns, we would understand if shareholders had concerns related to the CEO's pay.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Eris Lifesciences 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. 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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