This Is Why Shareholders May Want To Hold Back On A Pay Rise For VRL Logistics Limited's (NSE:VRLLOG) CEO

Performance at VRL Logistics Limited (NSE:VRLLOG) has not been particularly rosy recently and shareholders will likely be holding CEO Vijay Sankeshwar and the board accountable for this. At the upcoming AGM on 07 August 2021, shareholders may have the opportunity to influence management to turn the performance around by voting on resolutions such as executive remuneration and other matters. We think most shareholders will probably pass the CEO compensation, based on what we gathered.

Check out our latest analysis for VRL Logistics

How Does Total Compensation For Vijay Sankeshwar Compare With Other Companies In The Industry?

According to our data, VRL Logistics Limited has a market capitalization of ₹27b, and paid its CEO total annual compensation worth ₹31m over the year to March 2021. Notably, that's a decrease of 23% over the year before. It is worth noting that the CEO compensation consists entirely of the salary, worth ₹31m.

On comparing similar companies from the same industry with market caps ranging from ₹15b to ₹59b, we found that the median CEO total compensation was ₹58m. That is to say, Vijay Sankeshwar is paid under the industry median. Furthermore, Vijay Sankeshwar directly owns ₹9.1b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2021	2020	Proportion (2021)
Salary	₹31m	₹34m	100%
Other	-	₹6.5m	-
Total Compensation	₹31m	₹40m	100%

Speaking on an industry level, all of total compensation represents salary, while non-salary remuneration is completely ignored. Speaking on a company level, VRL 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.

VRL Logistics Limited's Growth

Over the last three years, VRL Logistics Limited has shrunk its earnings per share by 21% per year. It saw its revenue drop 17% over the last year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 VRL Logistics Limited Been A Good Investment?

Given the total shareholder loss of 6.3% over three years, many shareholders in VRL Logistics Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

VRL Logistics pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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 VRL Logistics you should be aware of, and 1 of them makes us a bit uncomfortable.

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.

When trading VRL Logistics or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.