It Looks Like Aditya Birla Fashion and Retail Limited's (NSE:ABFRL) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• Aditya Birla Fashion and Retail will host its Annual General Meeting on 23rd of September
• Total pay for CEO Ashish Dikshit includes ₹59.3m salary
• The total compensation is 266% higher than the average for the industry
• Over the past three years, Aditya Birla Fashion and Retail's EPS fell by 87% and over the past three years, the total loss to shareholders 32%

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The results at Aditya Birla Fashion and Retail Limited (NSE:ABFRL) have been quite disappointing recently and CEO Ashish Dikshit bears some responsibility for this. At the upcoming AGM on 23rd of September, shareholders can hear from the board including their plans for turning around performance. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for Aditya Birla Fashion and Retail

Comparing Aditya Birla Fashion and Retail Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Aditya Birla Fashion and Retail Limited has a market capitalization of ₹105b, and reported total annual CEO compensation of ₹100m for the year to March 2025. That's mostly flat as compared to the prior year's compensation. Notably, the salary which is ₹59.3m, represents a considerable chunk of the total compensation being paid.

On comparing similar companies from the Indian Specialty Retail industry with market caps ranging from ₹35b to ₹141b, we found that the median CEO total compensation was ₹27m. Accordingly, our analysis reveals that Aditya Birla Fashion and Retail Limited pays Ashish Dikshit north of the industry median. What's more, Ashish Dikshit holds ₹31m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Speaking on an industry level, nearly 100% of total compensation represents salary, while the remainder of 0.00666756% is other remuneration. Aditya Birla Fashion and Retail sets aside a smaller share of compensation for salary, in comparison to the overall industry. 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.

Aditya Birla Fashion and Retail Limited's Growth

Aditya Birla Fashion and Retail Limited has reduced its earnings per share by 87% a year over the last three years. It saw its revenue drop 47% over the last year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Aditya Birla Fashion and Retail Limited Been A Good Investment?

With a total shareholder return of -32% over three years, Aditya Birla Fashion and Retail Limited shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for Aditya Birla Fashion and Retail that investors should look into moving forward.

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.