T. Raghunathan became the CEO of TTK Healthcare Limited (NSE:TTKHEALTH) in 2014. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
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How Does T. Raghunathan’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that TTK Healthcare Limited has a market cap of ₹11b, and is paying total annual CEO compensation of ₹16m. (This figure is for the year to 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at ₹3.6m. We examined companies with market caps from ₹7.0b to ₹28b, and discovered that the median CEO compensation of that group was ₹16m.
So T. Raghunathan is paid around the average of the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at TTK Healthcare, below.
Is TTK Healthcare Limited Growing?
Over the last three years TTK Healthcare Limited has shrunk its earnings per share by an average of 12% per year. Its revenue is up 23% over last year.
Unfortunately, earnings per share have trended lower over the last three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.
Although we don’t have analyst forecasts, you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has TTK Healthcare Limited Been A Good Investment?
With a three year total loss of 19%, TTK Healthcare Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
In Summary…
T. Raghunathan is paid around what is normal the leaders of comparable size companies.
Returns have been disappointing and the company is not growing its earnings per share. Few would argue that it’s wise for the company to pay any more, before returns improve. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling TTK Healthcare (free visualization of insider trades).