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In 2008 D. Maheshwari was appointed CEO of Jay Shree Tea & Industries Limited (NSE:JAYSHREETEA). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does D. Maheshwari's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Jay Shree Tea & Industries Limited has a market cap of ₹1.7b, and is paying total annual CEO compensation of ₹12m. (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 ₹7.5m. We took a group of companies with market capitalizations below ₹14b, and calculated the median CEO total compensation to be ₹1.3m.
As you can see, D. Maheshwari is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Jay Shree Tea & Industries 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.
The graphic below shows how CEO compensation at Jay Shree Tea & Industries has changed from year to year.
Is Jay Shree Tea & Industries Limited Growing?
Over the last three years Jay Shree Tea & Industries Limited has grown its earnings per share (EPS) by an average of 16% per year (using a line of best fit). Its revenue is down -2.3% over last year.
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. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Jay Shree Tea & Industries Limited Been A Good Investment?
Since shareholders would have lost about 40% over three years, some Jay Shree Tea & Industries Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We examined the amount Jay Shree Tea & Industries 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.
Importantly, though, the company has impressed with its earnings per share growth, over three years. However, the returns to investors are far less impressive, over the same period. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Jay Shree Tea & Industries.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 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.