We Think Some Shareholders May Hesitate To Increase AVG Logistics Limited's (NSE:AVG) CEO Compensation

Key Insights

• AVG Logistics will host its Annual General Meeting on 30th of September
• Total pay for CEO Sanjay Gupta includes ₹7.80m salary
• Total compensation is 149% above industry average
• AVG Logistics' total shareholder return over the past three years was 643% while its EPS grew by 97% over the past three years

Under the guidance of CEO Sanjay Gupta, AVG Logistics Limited (NSE:AVG) 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 30th of September. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for AVG Logistics

How Does Total Compensation For Sanjay Gupta Compare With Other Companies In The Industry?

At the time of writing, our data shows that AVG Logistics Limited has a market capitalization of ₹6.0b, and reported total annual CEO compensation of ₹7.8m for the year to March 2024. There was no change in the compensation compared to last year. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹7.8m.

In comparison with other companies in the India Transportation industry with market capitalizations under ₹17b, the reported median total CEO compensation was ₹3.1m. Accordingly, our analysis reveals that AVG Logistics Limited pays Sanjay Gupta north of the industry median. What's more, Sanjay Gupta holds ₹751m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	₹7.8m	₹7.8m	100%
Other	-	-	-
Total Compensation	₹7.8m	₹7.8m	100%

Talking in terms of the industry, salary represents all of total compensation among the companies we analyzed, while other remuneration is, interestingly, completely ignored. Speaking on a company level, AVG Logistics prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at AVG Logistics Limited's Growth Numbers

AVG Logistics Limited's earnings per share (EPS) grew 97% per year over the last three years. In the last year, its revenue is up 17%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has AVG Logistics Limited Been A Good Investment?

Boasting a total shareholder return of 643% over three years, AVG Logistics Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

AVG Logistics rewards its CEO solely through a salary, ignoring non-salary benefits completely. 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, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 5 warning signs for AVG Logistics (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

Important note: AVG Logistics 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.