In 2011 Himanshu Kapania was appointed CEO of Vodafone Idea Limited (NSE:IDEA). First, this article will compare CEO compensation with compensation at similar sized companies. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Vodafone Idea

How Does Himanshu Kapania’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Vodafone Idea Limited has a market cap of ₹340.7b, and is paying total annual CEO compensation of ₹100m. We note that’s an increase of 10% above last year. We looked at a group of companies with market capitalizations from ₹147.1b to ₹470.6b, and the median CEO compensation was ₹50m.

Thus we can conclude that Himanshu Kapania receives more in total compensation than the median of a group of companies in the same market, and of similar size to Vodafone Idea Limited. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at Vodafone Idea, below.

Is Vodafone Idea Limited Growing?

Over the last three years Vodafone Idea Limited has shrunk its earnings per share by an average of 115% per year. It saw its revenue drop -24% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.

It could be important to check this free visual depiction of what analysts expect for the future.

Has Vodafone Idea Limited Been A Good Investment?

Since shareholders would have lost about 72% over three years, some Vodafone Idea Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.

In Summary…

We compared total CEO remuneration at Vodafone Idea Limited with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of 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. And we’d be remiss not to note that the CEO remuneration has increased on last year. In our opinion the CEO might be paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Vodafone Idea Limited (free visualization of insider trades).

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.