How Much Is Ajmera Realty & Infra India Limited (NSE:AJMERA) CEO Getting Paid?

Rajnikant Ajmera became the CEO of Ajmera Realty & Infra India Limited (NSE:AJMERA) in 2009, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Ajmera Realty & Infra India pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Ajmera Realty & Infra India

Comparing Ajmera Realty & Infra India Limited's CEO Compensation With the industry

At the time of writing, our data shows that Ajmera Realty & Infra India Limited has a market capitalization of ₹4.7b, and reported total annual CEO compensation of ₹14m for the year to March 2020. That is, the compensation was roughly the same as last year. Notably, the salary which is ₹13.4m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under ₹15b, the reported median total CEO compensation was ₹2.3m. Accordingly, our analysis reveals that Ajmera Realty & Infra India Limited pays Rajnikant Ajmera north of the industry median.

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. Our data reveals that Ajmera Realty & Infra India allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Ajmera Realty & Infra India Limited's Growth Numbers

Over the last three years, Ajmera Realty & Infra India Limited has shrunk its earnings per share by 36% per year. It saw its revenue drop 33% over the last 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. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Ajmera Realty & Infra India Limited Been A Good Investment?

With a three year total loss of 53% for the shareholders, Ajmera Realty & Infra India Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we touched on above, Ajmera Realty & Infra India Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Disappointingly, share price gains over the last three years have failed to materialize. Arguably worse, we've been waiting for positive EPS growth for the last three years. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 6 warning signs (and 1 which doesn't sit too well with us) in Ajmera Realty & Infra India we think you should know about.

Important note: Ajmera Realty & Infra India 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. 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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