U.S. Markets open in 4 hrs 1 min

Does GTL Infrastructure Limited's (NSE:GTLINFRA) CEO Pay Reflect Performance?

Simply Wall St

The CEO of GTL Infrastructure Limited (NSE:GTLINFRA) is Milind Naik. 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for GTL Infrastructure

How Does Milind Naik's Compensation Compare With Similar Sized Companies?

According to our data, GTL Infrastructure Limited has a market capitalization of ₹7.0b, and pays its CEO total annual compensation worth ₹5.0m. (This is based on the year to March 2018). We think total compensation is more important but we note that the CEO salary is lower, at ₹2.0m. We took a group of companies with market capitalizations below ₹14b, and calculated the median CEO total compensation to be ₹1.5m.

As you can see, Milind Naik is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean GTL Infrastructure Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at GTL Infrastructure, below.

NSEI:GTLINFRA CEO Compensation, August 22nd 2019

Is GTL Infrastructure Limited Growing?

Over the last three years GTL Infrastructure Limited has grown its earnings per share (EPS) by an average of 12% per year (using a line of best fit). In the last year, its revenue is down -29%.

This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has GTL Infrastructure Limited Been A Good Investment?

With a three year total loss of 74%, GTL Infrastructure 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 total CEO remuneration at GTL Infrastructure Limited with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Whatever your view on compensation, you might want to check if insiders are buying or selling GTL Infrastructure shares (free trial).

Important note: GTL Infrastructure may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE 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.