Is Aarti Industries Limited’s (NSE:AARTIIND) CEO Pay Fair?

In this article:

Rajendra Gogri is the CEO of Aarti Industries Limited (NSE:AARTIIND). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Aarti Industries

How Does Rajendra Gogri’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Aarti Industries Limited has a market cap of ₹120b, and is paying total annual CEO compensation of ₹32m. (This number is for the twelve months until March 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at ₹5.9m. We looked at a group of companies with market capitalizations from ₹70b to ₹224b, and the median CEO compensation was ₹38m.

So Rajendra Gogri receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

The graphic below shows how CEO compensation at Aarti Industries has changed from year to year.

NSEI:AARTIIND CEO Compensation, March 12th 2019
NSEI:AARTIIND CEO Compensation, March 12th 2019

Is Aarti Industries Limited Growing?

Aarti Industries Limited has increased its earnings per share (EPS) by an average of 19% a year, over the last three years (using a line of best fit). Its revenue is up 20% over last year.

This demonstrates that the company has been improving recently. A good result. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.

Has Aarti Industries Limited Been A Good Investment?

Boasting a total shareholder return of 204% over three years, Aarti Industries 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.

In Summary…

Rajendra Gogri is paid around the same as most CEOs of similar size companies.

Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. So one could argue the CEO compensation is quite modest, if you consider company performance! So you may want to check if insiders are buying Aarti Industries shares with their own money (free access).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.

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