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In 2016 Chirayu Amin was appointed CEO of Alembic Pharmaceuticals Limited (NSE:APLLTD). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Alembic Pharmaceuticals
How Does Chirayu Amin’s Compensation Compare With Similar Sized Companies?
Our data indicates that Alembic Pharmaceuticals Limited is worth ₹109b, and total annual CEO compensation is ₹220m. (This is based on the year to 2018). We think total compensation is more important but we note that the CEO salary is lower, at ₹55m. We looked at a group of companies with market capitalizations from ₹70b to ₹224b, and the median CEO compensation was ₹38m.
It would therefore appear that Alembic Pharmaceuticals Limited pays Chirayu Amin more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Alembic Pharmaceuticals has changed from year to year.
Is Alembic Pharmaceuticals Limited Growing?
On average over the last three years, Alembic Pharmaceuticals Limited has shrunk earnings per share by 17% each year. Its revenue is up 26% over last year.
Investors should note that, over three years, earnings per share are down. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It’s hard to reach a conclusion about business performance right now. This may be one to watch.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Alembic Pharmaceuticals Limited Been A Good Investment?
Given the total loss of 18% over three years, many shareholders in Alembic Pharmaceuticals Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary…
We examined the amount Alembic Pharmaceuticals Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.