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Is Pioneer Embroideries Limited's (NSE:PIONEEREMB) CEO Being Overpaid?

Simply Wall St

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In 2014 Harsh Bassi was appointed CEO of Pioneer Embroideries Limited (NSE:PIONEEREMB). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Pioneer Embroideries

How Does Harsh Bassi's Compensation Compare With Similar Sized Companies?

Our data indicates that Pioneer Embroideries Limited is worth ₹548m, and total annual CEO compensation is ₹6.5m. (This figure is for the year to March 2018). It is worth noting that the CEO compensation consists almost entirely of the salary, worth ₹6.5m. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹1.4m.

Thus we can conclude that Harsh Bassi receives more in total compensation than the median of a group of companies in the same market, and of similar size to Pioneer Embroideries Limited. However, this doesn't necessarily mean the pay 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.

The graphic below shows how CEO compensation at Pioneer Embroideries has changed from year to year.

NSEI:PIONEEREMB CEO Compensation, July 19th 2019

Is Pioneer Embroideries Limited Growing?

Pioneer Embroideries Limited has reduced its earnings per share by an average of 28% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 6.6%.

Unfortunately, earnings per share have trended lower over the last three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Pioneer Embroideries Limited Been A Good Investment?

With a three year total loss of 51%, Pioneer Embroideries Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We examined the amount Pioneer Embroideries 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.

Earnings per share have not grown in three years, and the revenue growth fails to impress us.

Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Pioneer Embroideries.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.