Here's Why Shareholders May Want To Be Cautious With Increasing Prozone Intu Properties Limited's (NSE:PROZONINTU) CEO Pay Packet

Performance at Prozone Intu Properties Limited (NSE:PROZONINTU) has been reasonably good and CEO Nikhil Chaturvedi 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 30 September 2022. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for Prozone Intu Properties

How Does Total Compensation For Nikhil Chaturvedi Compare With Other Companies In The Industry?

At the time of writing, our data shows that Prozone Intu Properties Limited has a market capitalization of ₹3.5b, and reported total annual CEO compensation of ₹18m for the year to March 2022. We note that's an increase of 36% above last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹18m.

On comparing similar-sized companies in the industry with market capitalizations below ₹16b, we found that the median total CEO compensation was ₹1.8m. Accordingly, our analysis reveals that Prozone Intu Properties Limited pays Nikhil Chaturvedi north of the industry median. Furthermore, Nikhil Chaturvedi directly owns ₹325m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2022	2021	Proportion (2022)
Salary	₹18m	₹13m	100%
Other	-	-	-
Total Compensation	₹18m	₹13m	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. At the company level, Prozone Intu Properties pays Nikhil Chaturvedi solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Prozone Intu Properties Limited's Growth Numbers

Prozone Intu Properties Limited has reduced its earnings per share by 20% a year over the last three years. Its revenue is up 122% over the last year.

Investors would be a bit wary of companies that have lower EPS On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 Prozone Intu Properties Limited Been A Good Investment?

Boasting a total shareholder return of 37% over three years, Prozone Intu Properties 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...

Prozone Intu Properties rewards its CEO solely through a salary, ignoring non-salary benefits completely. Although the company has performed relatively well, we still think there are some areas that could be improved. Until EPS growth picks back up, we think shareholders may find it hard to justify increasing CEO pay given that they are already paid above industry average.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Prozone Intu Properties you should be aware of, and 1 of them makes us a bit uncomfortable.

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.