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P. Choudhary has been the CEO of Hindustan Composites Limited (NSE:HINDCOMPOS) since 2008. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. 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 Hindustan Composites
How Does P. Choudhary's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Hindustan Composites Limited has a market cap of ₹2.8b, and is paying total annual CEO compensation of ₹7.9m. (This figure is for the year to March 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at ₹6.5m. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹1.3m.
Thus we can conclude that P. Choudhary receives more in total compensation than the median of a group of companies in the same market, and of similar size to Hindustan Composites Limited. However, this doesn't necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Hindustan Composites has changed from year to year.
Is Hindustan Composites Limited Growing?
Hindustan Composites Limited has reduced its earnings per share by an average of 1.7% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is down -1.3%.
The lack of earnings per share growth in the last three years is unimpressive. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Hindustan Composites Limited Been A Good Investment?
Given the total loss of 47% over three years, many shareholders in Hindustan Composites Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.