We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Arihant Superstructures Limited's (NSE:ARIHANTSUP) CEO For Now

Key Insights

• Arihant Superstructures to hold its Annual General Meeting on 23rd of September
• Salary of ₹7.28m is part of CEO Ashokkumar Chhajer's total remuneration
• The overall pay is 304% above the industry average
• Arihant Superstructures' total shareholder return over the past three years was 799% while its EPS grew by 54% over the past three years

Performance at Arihant Superstructures Limited (NSE:ARIHANTSUP) has been reasonably good and CEO Ashokkumar Chhajer has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 23rd of September. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for Arihant Superstructures

How Does Total Compensation For Ashokkumar Chhajer Compare With Other Companies In The Industry?

At the time of writing, our data shows that Arihant Superstructures Limited has a market capitalization of ₹7.6b, and reported total annual CEO compensation of ₹7.3m for the year to March 2023. That's a notable increase of 12% on last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹7.3m.

On comparing similar-sized companies in the Indian Real Estate industry with market capitalizations below ₹17b, we found that the median total CEO compensation was ₹1.8m. Hence, we can conclude that Ashokkumar Chhajer is remunerated higher than the industry median. What's more, Ashokkumar Chhajer holds ₹3.4b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	₹7.3m	₹6.5m	100%
Other	-	-	-
Total Compensation	₹7.3m	₹6.5m	100%

On an industry level, it's fascinating to see that all of total compensation represents salary and non-salary benefits do not factor into the equation at all. Speaking on a company level, Arihant Superstructures prefers to tread along a traditional path, disbursing all compensation through a salary. 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.

A Look at Arihant Superstructures Limited's Growth Numbers

Arihant Superstructures Limited has seen its earnings per share (EPS) increase by 54% a year over the past three years. Its revenue is up 26% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Arihant Superstructures Limited Been A Good Investment?

Boasting a total shareholder return of 799% over three years, Arihant Superstructures Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Arihant Superstructures rewards its CEO solely through a salary, ignoring non-salary benefits completely. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 2 warning signs (and 1 which is a bit unpleasant) in Arihant Superstructures we think you should know about.

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.