Shareholders Will Probably Not Have Any Issues With SJVN Limited's (NSE:SJVN) CEO Compensation

Shareholders may be wondering what CEO Nand Sharma plans to do to improve the less than great performance at SJVN Limited (NSE:SJVN) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 29 September 2022. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. In our opinion, CEO compensation does not look excessive and we discuss why.

Check out our latest analysis for SJVN

Comparing SJVN Limited's CEO Compensation With The Industry

According to our data, SJVN Limited has a market capitalization of ₹129b, and paid its CEO total annual compensation worth ₹13m over the year to March 2022. We note that's an increase of 32% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₹3.9m.

For comparison, other companies in the same industry with market capitalizations ranging between ₹80b and ₹256b had a median total CEO compensation of ₹69m. Accordingly, SJVN pays its CEO under the industry median.

Component	2022	2021	Proportion (2022)
Salary	₹3.9m	₹3.9m	30%
Other	₹9.1m	₹5.9m	70%
Total Compensation	₹13m	₹9.8m	100%

Speaking on an industry level, nearly 57% of total compensation represents salary, while the remainder of 43% is other remuneration. SJVN pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at SJVN Limited's Growth Numbers

Over the last three years, SJVN Limited has shrunk its earnings per share by 5.7% per year. It achieved revenue growth of 12% over the last year.

Few shareholders would be pleased to read that EPS have declined. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has SJVN Limited Been A Good Investment?

Most shareholders would probably be pleased with SJVN Limited for providing a total return of 68% 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.

In Summary...

While the return to shareholders does look promising, it's hard to ignore the lack of earnings growth and this makes us wonder if these strong returns can continue. These are are some concerns that shareholders may want to address the board when they revisit their investment thesis.

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. That's why we did some digging and identified 2 warning signs for SJVN that investors should think about before committing capital to this stock.

Important note: SJVN 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.