Saksoft Limited's (NSE:SAKSOFT) CEO Compensation Is Looking A Bit Stretched At The Moment
Under the guidance of CEO Aditya Krishna, Saksoft Limited (NSE:SAKSOFT) 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 10 August 2021. However, some shareholders may still want to keep CEO compensation within reason.
Check out our latest analysis for Saksoft
Comparing Saksoft Limited's CEO Compensation With the industry
Our data indicates that Saksoft Limited has a market capitalization of ₹6.8b, and total annual CEO compensation was reported as ₹6.0m for the year to March 2021. That's a modest increase of 3.6% on the prior year. We note that the salary portion, which stands at ₹5.82m constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below ₹15b, we found that the median total CEO compensation was ₹2.8m. This suggests that Aditya Krishna is paid more than the median for the industry. Furthermore, Aditya Krishna directly owns ₹1.5b worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2021 | 2020 | Proportion (2021) |
| Salary | ₹5.8m | ₹5.4m | 97% |
| Other | ₹210k | ₹420k | 3% |
| Total Compensation | ₹6.0m | ₹5.8m | 100% |
On an industry level, roughly 100% of total compensation represents salary and 0.3647% is other remuneration. Saksoft is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. 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 Saksoft Limited's Growth Numbers
Saksoft Limited's earnings per share (EPS) grew 28% per year over the last three years. It achieved revenue growth of 8.4% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Saksoft Limited Been A Good Investment?
We think that the total shareholder return of 212%, over three years, would leave most Saksoft Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
Aditya receives almost all of their compensation through a salary. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.
CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 2 warning signs for Saksoft 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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About NSEI:SAKSOFT
Saksoft
An information technology company, provides digital transformation solutions in Europe, the United States, the Asia Pacific, and internationally.
Flawless balance sheet established dividend payer.
