How Does Total Transport Systems' (NSE:TOTAL) CEO Pay Compare With Company Performance?

Makarand Pradhan has been the CEO of Total Transport Systems Limited (NSE:TOTAL) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Total Transport Systems pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Total Transport Systems

Comparing Total Transport Systems Limited's CEO Compensation With the industry

Our data indicates that Total Transport Systems Limited has a market capitalization of ₹901m, and total annual CEO compensation was reported as ₹5.8m for the year to March 2020. This means that the compensation hasn't changed much from last year. In particular, the salary of ₹5.20m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under ₹15b, the reported median total CEO compensation was ₹11m. This suggests that Makarand Pradhan is paid below the industry median. Furthermore, Makarand Pradhan directly owns ₹157m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 97% of total compensation represents salary and 3.3% is other remuneration. Our data reveals that Total Transport Systems allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Total Transport Systems Limited's Growth Numbers

Over the last three years, Total Transport Systems Limited has shrunk its earnings per share by 105% per year. Its revenue is down 4.6% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Total Transport Systems Limited Been A Good Investment?

Total Transport Systems Limited has served shareholders reasonably well, with a total return of 20% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

As we noted earlier, Total Transport Systems pays its CEO lower than the norm for similar-sized companies belonging to the same industry. Shareholder returns have been uninspiring, but EPS growth has arguably been worse, over the last three years. So, although we can't say CEO compensation is very high, shareholders might want to see an improvement in overall performance before agreeing that Makarand deserves a bump.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 4 warning signs for Total Transport Systems you should be aware of, and 2 of them shouldn't be ignored.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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This article by Simply Wall St is general in nature. 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.
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