In 1999 Gautam Singhania was appointed CEO of Raymond Limited (NSE:RAYMOND). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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.
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How Does Gautam Singhania's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Raymond Limited has a market cap of ₹48b, and is paying total annual CEO compensation of ₹94m. (This figure is for the year to March 2018). While we always look at total compensation first, we note that the salary component is less, at ₹52m. When we examined a selection of companies with market caps ranging from ₹28b to ₹112b, we found the median CEO total compensation was ₹26m.
As you can see, Gautam Singhania is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Raymond Limited is paying too much. 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 a visual representation of the CEO compensation at Raymond, below.
Is Raymond Limited Growing?
Over the last three years Raymond Limited has grown its earnings per share (EPS) by an average of 33% per year (using a line of best fit). Its revenue is up 12% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.
Has Raymond Limited Been A Good Investment?
Boasting a total shareholder return of 71% over three years, Raymond Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
We examined the amount Raymond Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. Even better, returns to shareholders have been plentiful, over the same time period. So, considering this good performance, the CEO compensation may be quite appropriate. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Raymond (free visualization of insider trades).
If you want to buy a stock that is better than Raymond, this free list of high return, low debt companies is a great place to look.
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 firstname.lastname@example.org. 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.