Our Take On Khadim India's (NSE:KHADIM) CEO Salary

Siddhartha Burman has been the CEO of Khadim India Limited (NSE:KHADIM) since 2005, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

Check out our latest analysis for Khadim India

Comparing Khadim India Limited's CEO Compensation With the industry

According to our data, Khadim India Limited has a market capitalization of ₹2.6b, and paid its CEO total annual compensation worth ₹31m over the year to March 2020. That is, the compensation was roughly the same as last year. Notably, the salary which is ₹30.2m, represents most of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below ₹15b, reported a median total CEO compensation of ₹7.7m. Accordingly, our analysis reveals that Khadim India Limited pays Siddhartha Burman north of the industry median. Furthermore, Siddhartha Burman directly owns ₹237m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. Khadim India pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. 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 Khadim India Limited's Growth Numbers

Over the last three years, Khadim India Limited has shrunk its earnings per share by 123% per year. Its revenue is down 37% over the previous year.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last 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 Khadim India Limited Been A Good Investment?

With a three year total loss of 80% for the shareholders, Khadim India Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

Khadim India pays its CEO a majority of compensation through a salary. As previously discussed, Siddhartha is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. This doesn't look good against shareholder returns, which have been negative for the past three years. What's equally worrying is that the company isn't growing by our analysis. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 3 warning signs (and 1 which shouldn't be ignored) in Khadim India 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. 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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