Here's Why Shareholders May Want To Be Cautious With Increasing GMR Airports Infrastructure Limited's (NSE:GMRINFRA) CEO Pay Packet

Key Insights

• GMR Airports Infrastructure will host its Annual General Meeting on 18th of September
• Total pay for CEO Kiran Grandhi includes ₹22.4m salary
• Total compensation is 131% above industry average
• GMR Airports Infrastructure's EPS grew by 77% over the past three years while total shareholder return over the past three years was 201%

Under the guidance of CEO Kiran Grandhi, GMR Airports Infrastructure Limited (NSE:GMRINFRA) has performed reasonably well recently. 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 18th of September. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for GMR Airports Infrastructure

Comparing GMR Airports Infrastructure Limited's CEO Compensation With The Industry

Our data indicates that GMR Airports Infrastructure Limited has a market capitalization of ₹388b, and total annual CEO compensation was reported as ₹24m for the year to March 2023. We note that's an increase of 59% above last year. We note that the salary portion, which stands at ₹22.4m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the India Infrastructure industry with market capitalizations ranging from ₹166b to ₹531b, the reported median CEO total compensation was ₹10m. This suggests that Kiran Grandhi is paid more than the median for the industry. Furthermore, Kiran Grandhi directly owns ₹56m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	₹22m	₹15m	93%
Other	₹1.7m	-	7%
Total Compensation	₹24m	₹15m	100%

On an industry level, it's fascinating to see that all of total compensation represents salary and non-salary benefits do not factor into the equation at all. Although there is a difference in how total compensation is set, GMR Airports Infrastructure more or less reflects the market in terms of setting the salary. 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 GMR Airports Infrastructure Limited's Growth Numbers

Over the past three years, GMR Airports Infrastructure Limited has seen its earnings per share (EPS) grow by 77% per year. It achieved revenue growth of 42% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has GMR Airports Infrastructure Limited Been A Good Investment?

Most shareholders would probably be pleased with GMR Airports Infrastructure Limited for providing a total return of 201% over three years. 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...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

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 GMR Airports Infrastructure that investors should look into moving forward.

Important note: GMR Airports Infrastructure 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.