Here's Why Tata Communications Limited's (NSE:TATACOMM) CEO Compensation Is The Least Of Shareholders' Concerns

Key Insights

• Tata Communications will host its Annual General Meeting on 9th of July
• Salary of ₹68.7m is part of CEO Lakshmi Lakshminarayanan's total remuneration
• The total compensation is similar to the average for the industry
• Tata Communications' total shareholder return over the past three years was 95% while its EPS grew by 3.1% over the past three years

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Performance at Tata Communications Limited (NSE:TATACOMM) has been reasonably good and CEO Lakshmi Lakshminarayanan has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 9th of July. We present our case of why we think CEO compensation looks fair.

View our latest analysis for Tata Communications

Comparing Tata Communications Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Tata Communications Limited has a market capitalization of ₹515b, and reported total annual CEO compensation of ₹192m for the year to March 2025. Notably, that's an increase of 13% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹69m.

For comparison, other companies in the India Telecom industry with market capitalizations ranging between ₹343b and ₹1.0t had a median total CEO compensation of ₹177m. This suggests that Tata Communications remunerates its CEO largely in line with the industry average.

Talking in terms of the industry, salary represented approximately 62% of total compensation out of all the companies we analyzed, while other remuneration made up 38% of the pie. It's interesting to note that Tata Communications allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Tata Communications Limited's Growth Numbers

Tata Communications Limited's earnings per share (EPS) grew 3.1% per year over the last three years. It achieved revenue growth of 11% over the last year.

We would argue that the modest growth in revenue is a notable positive. And the improvement in EPSis modest but respectable. So while performance isn't amazing, we think it really does seem quite respectable. 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 Tata Communications Limited Been A Good Investment?

Boasting a total shareholder return of 95% over three years, Tata Communications 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...

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. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

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 identified 3 warning signs for Tata Communications (1 is concerning!) that you should be aware of before investing here.

Switching gears from Tata Communications, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.