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S. K. M. ShivKumar has been the CEO of SKM Egg Products Export (India) Limited (NSE:SKMEGGPROD) since 2015. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. 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 S. K. M. ShivKumar's Compensation Compare With Similar Sized Companies?
According to our data, SKM Egg Products Export (India) Limited has a market capitalization of ₹1.1b, and pays its CEO total annual compensation worth ₹4.4m. (This is based on the year to March 2018). While we always look at total compensation first, we note that the salary component is less, at ₹4.1m. We examined a group of similar sized companies, with market capitalizations of below ₹14b. The median CEO total compensation in that group is ₹1.3m.
As you can see, S. K. M. ShivKumar is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean SKM Egg Products Export (India) 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, below, how CEO compensation at SKM Egg Products Export (India) has changed over time.
Is SKM Egg Products Export (India) Limited Growing?
Over the last three years SKM Egg Products Export (India) Limited has shrunk its earnings per share by an average of 74% per year (measured with a line of best fit). In the last year, its revenue is up 5.3%.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has SKM Egg Products Export (India) Limited Been A Good Investment?
With a three year total loss of 38%, SKM Egg Products Export (India) Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
We compared total CEO remuneration at SKM Egg Products Export (India) 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.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. Some might well form the view that the CEO is paid too generously! So you may want to check if insiders are buying SKM Egg Products Export (India) shares with their own money (free access).
If you want to buy a stock that is better than SKM Egg Products Export (India), 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.