Here's Why FDC Limited's (NSE:FDC) CEO May Have Their Pay Bumped Up

Key Insights

• FDC to hold its Annual General Meeting on 27th of September
• CEO Nandan Chandavarkar's total compensation includes salary of ₹10.5m
• Total compensation is 42% below industry average
• Over the past three years, FDC's EPS fell by 3.8% and over the past three years, the total shareholder return was 5.8%

Shareholders will be pleased by the robust performance of FDC Limited (NSE:FDC) recently and this will be kept in mind in the upcoming AGM on 27th of September. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.

View our latest analysis for FDC

Comparing FDC Limited's CEO Compensation With The Industry

At the time of writing, our data shows that FDC Limited has a market capitalization of ₹59b, and reported total annual CEO compensation of ₹24m for the year to March 2023. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹10m.

For comparison, other companies in the Indian Pharmaceuticals industry with market capitalizations ranging between ₹33b and ₹133b had a median total CEO compensation of ₹42m. This suggests that Nandan Chandavarkar is paid below the industry median. Moreover, Nandan Chandavarkar also holds ₹1.9b worth of FDC stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	₹10m	₹11m	43%
Other	₹14m	₹13m	57%
Total Compensation	₹24m	₹24m	100%

Talking in terms of the industry, salary represented approximately 92% of total compensation out of all the companies we analyzed, while other remuneration made up 8% of the pie. FDC sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

FDC Limited's Growth

FDC Limited has reduced its earnings per share by 3.8% a year over the last three years. In the last year, its revenue is up 16%.

Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 FDC Limited Been A Good Investment?

FDC Limited has not done too badly by shareholders, with a total return of 5.8%, over three years. It would be nice to see that metric improve in the future. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

In Summary...

Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for FDC that investors should look into moving forward.

Important note: FDC 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.