Is Kalyani Steels Limited's (NSE:KSL) CEO Salary Justified?
Ravindra Goyal has been the CEO of Kalyani Steels Limited (NSE:KSL) since 2011. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
View our latest analysis for Kalyani Steels
How Does Ravindra Goyal's Compensation Compare With Similar Sized Companies?
Our data indicates that Kalyani Steels Limited is worth ₹8.8b, and total annual CEO compensation is ₹76m. (This number is for the twelve months until March 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at ₹49m. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹1.3m.
As you can see, Ravindra Goyal is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Kalyani Steels Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Kalyani Steels, below.
Is Kalyani Steels Limited Growing?
On average over the last three years, Kalyani Steels Limited has grown earnings per share (EPS) by 1.1% each year (using a line of best fit). It achieved revenue growth of 5.6% over the last year.
I'm not particularly impressed by the revenue growth, but I'm happy with the modest EPS growth. So there are some positives here, but not enough to earn high praise. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Kalyani Steels Limited Been A Good Investment?
I think that the total shareholder return of 38%, over three years, would leave most Kalyani Steels Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
We examined the amount Kalyani Steels 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.
Over the last three years returns to investors have been great, though we might have liked stronger business growth. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Kalyani Steels (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.
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.
