Is Kaveri Seed Company Limited’s (NSE:KSCL) CEO Paid At A Competitive Rate?

Bryan Cramer

Sat, Feb 23, 2019, 6:03 PM

Gundavaram Venkata Rao has been the CEO of Kaveri Seed Company Limited (NSE:KSCL) since 1986. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Kaveri Seed

How Does Gundavaram Venkata Rao’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Kaveri Seed Company Limited has a market cap of ₹26b, and is paying total annual CEO compensation of ₹20m. (This figure is for the year to March 2018). Notably, the salary of ₹19m is the vast majority of the CEO compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of ₹14b to ₹57b. The median total CEO compensation was ₹23m.

So Gundavaram Venkata Rao is paid around the average of the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at Kaveri Seed, below.

NSEI:KSCL CEO Compensation, February 24th 2019

Is Kaveri Seed Company Limited Growing?

On average over the last three years, Kaveri Seed Company Limited has shrunk earnings per share by 18% each year (measured with a line of best fit). Its revenue is up 16% over last year.

Unfortunately, earnings per share have trended lower over the last three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to check this free visual depiction of what analysts expect for the future.

Has Kaveri Seed Company Limited Been A Good Investment?

Kaveri Seed Company Limited has generated a total shareholder return of 21% over three years, so most shareholders would be reasonably content. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.