Why We Think FDC Limited's (NSE:FDC) CEO Compensation Is Not Excessive At All

Key Insights

• FDC will host its Annual General Meeting on 26th of September
• Total pay for CEO Nandan Chandavarkar includes ₹12.2m salary
• Total compensation is similar to the industry average
• FDC's total shareholder return over the past three years was 57% while its EPS grew by 2.1% over the past three years

Under the guidance of CEO Nandan Chandavarkar, FDC Limited (NSE:FDC) has performed reasonably well recently. As shareholders go into the upcoming AGM on 26th of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for FDC

Comparing FDC Limited's CEO Compensation With The Industry

Our data indicates that FDC Limited has a market capitalization of ₹90b, and total annual CEO compensation was reported as ₹30m for the year to March 2024. Notably, that's an increase of 23% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹12m.

On comparing similar companies from the Indian Pharmaceuticals industry with market caps ranging from ₹33b to ₹134b, we found that the median CEO total compensation was ₹39m. So it looks like FDC compensates Nandan Chandavarkar in line with the median for the industry. What's more, Nandan Chandavarkar holds ₹2.8b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	₹12m	₹10m	41%
Other	₹18m	₹14m	59%
Total Compensation	₹30m	₹24m	100%

On an industry level, around 99% of total compensation represents salary and 0.95087163% is other remuneration. FDC pays a modest slice of remuneration through salary, as compared 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.

A Look at FDC Limited's Growth Numbers

FDC Limited has seen its earnings per share (EPS) increase by 2.1% a year over the past three years. In the last year, its revenue is up 12%.

This revenue growth could really point to a brighter future. And the improvement in EPSis modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has FDC Limited Been A Good Investment?

We think that the total shareholder return of 57%, over three years, would leave most FDC Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its 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. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at FDC.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.