In 2005 B. S. Kumar was appointed CEO of HealthCare Global Enterprises Limited (NSE:HCG). 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does B. S. Kumar's Compensation Compare With Similar Sized Companies?
According to our data, HealthCare Global Enterprises Limited has a market capitalization of ₹9.4b, and paid its CEO total annual compensation worth ₹28m over the year to March 2019. Notably, the salary of ₹28m is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹2.3m.
It would therefore appear that HealthCare Global Enterprises Limited pays B. S. Kumar 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at HealthCare Global Enterprises has changed over time.
Is HealthCare Global Enterprises Limited Growing?
HealthCare Global Enterprises Limited has reduced its earnings per share by an average of 80% a year, over the last three years (measured with a line of best fit). Its revenue is up 18% over last year.
Unfortunately, earnings per share have trended lower over the last three years. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has HealthCare Global Enterprises Limited Been A Good Investment?
Since shareholders would have lost about 54% over three years, some HealthCare Global Enterprises Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We compared total CEO remuneration at HealthCare Global Enterprises Limited with the amount paid at companies with a similar market capitalization. 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. Arguably worse, investors are without a positive return for the last three years. 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 HealthCare Global Enterprises (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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