This Is Why V-Mart Retail Limited's (NSE:VMART) CEO Compensation Looks Appropriate

Key Insights

• V-Mart Retail's Annual General Meeting to take place on 15th of September
• Total pay for CEO Lalit Agarwal includes ₹9.82m salary
• Total compensation is similar to the industry average
• V-Mart Retail's total shareholder return over the past three years was 18% while its EPS grew by 21% over the past three years

Under the guidance of CEO Lalit Agarwal, V-Mart Retail Limited (NSE:VMART) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 15th of September. We present our case of why we think CEO compensation looks fair.

See our latest analysis for V-Mart Retail

Comparing V-Mart Retail Limited's CEO Compensation With The Industry

At the time of writing, our data shows that V-Mart Retail Limited has a market capitalization of ₹44b, and reported total annual CEO compensation of ₹20m for the year to March 2023. We note that's an increase of 15% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹9.8m.

In comparison with other companies in the India Multiline Retail industry with market capitalizations ranging from ₹17b to ₹66b, the reported median CEO total compensation was ₹20m. From this we gather that Lalit Agarwal is paid around the median for CEOs in the industry. What's more, Lalit Agarwal holds ₹524m 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	₹9.8m	₹8.6m	49%
Other	₹10m	₹9.0m	51%
Total Compensation	₹20m	₹18m	100%

On an industry level, around 72% of total compensation represents salary and 28% is other remuneration. V-Mart Retail sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at V-Mart Retail Limited's Growth Numbers

V-Mart Retail Limited has seen its earnings per share (EPS) increase by 21% a year over the past three years. Its revenue is up 23% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 V-Mart Retail Limited Been A Good Investment?

V-Mart Retail Limited has served shareholders reasonably well, with a total return of 18% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for V-Mart Retail that investors should look into moving forward.

Important note: V-Mart Retail 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. 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.