The CEO of Sarla Performance Fibers Limited (NSE:SARLAPOLY) is Krishnakumar Jhunjhunwala. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 Sarla Performance Fibers

How Does Krishnakumar Jhunjhunwala's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Sarla Performance Fibers Limited has a market cap of ₹2.0b, and is paying total annual CEO compensation of ₹14m. (This number is for the twelve months until March 2018). Notably, the salary of ₹14m is the vast majority of the CEO compensation. We took a group of companies with market capitalizations below ₹14b, and calculated the median CEO total compensation to be ₹1.5m.

It would therefore appear that Sarla Performance Fibers Limited pays Krishnakumar Jhunjhunwala 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 Sarla Performance Fibers has changed from year to year.

Is Sarla Performance Fibers Limited Growing?

On average over the last three years, Sarla Performance Fibers Limited has shrunk earnings per share by 21% each year (measured with a line of best fit). Its revenue is up 7.4% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Sarla Performance Fibers Limited Been A Good Investment?

With a three year total loss of 57%, Sarla Performance Fibers Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared the total CEO remuneration paid by Sarla Performance Fibers Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

We think many shareholders would be underwhelmed with the business growth over the last three years.

Just as bad, share price gains for investors have failed to materialize, over the same period. This analysis suggests to us that the CEO is paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Sarla Performance Fibers (free visualization of insider trades).

If you want to buy a stock that is better than Sarla Performance Fibers, this free list of high return, low debt companies is a great place to look.

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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.