Boards of Hero MotoCorp, Bajaj Auto reward CEOs handsomely despite profit growth slowing down

Source: Reuters

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26 Aug, 2025 12:21

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Hero MotoCorp Chairman Pawan Munjal remains India's highest-paid executive among listed Indian automobile manufacturers, followed by Bajaj Auto's Rajiv Bajaj.

Munjal took home a remuneration of Rs 75.44 crore in FY18, while Bajaj's pay for the year amounted to Rs 28.32 crore, according to disclosures made by their respective companies in their latest annual reports.

The growth in their remuneration was higher than the growth in the net profits of Hero MotoCorp and Bajaj Auto in the financial year ended March.

Hero MotoCorp's net profit for the year was 9.5 percent higher than its profit in FY17, particularly because of declining demand for entry-level bikes, a segment where it is the market leader.

But Munjal's pay grew by 26.45 percent over the same period, and was 838 times higher than the median salary of the company's 8,266 employees.

The median salary of Hero's employees was around Rs 9 lakh in FY18, 10.3 percent higher than in the previous financial year.

Coming to Bajaj Auto, Rajiv Bajaj's remuneration in FY18 was 10.66 percent higher than in FY17, and around 409 times higher than the median salary of the company's employees.

But Bajaj Auto's 9,503 employees were richly rewarded last year with a jump of 41.2 percent in their median pay to Rs 6.91 lakh.

To put things in perspective, Bajaj Auto's net profit grew by 6.3 percent year on year in FY18.

While its domestic motorcycle sales came under pressure, especially in the commuter (125cc) segment, exports of two-wheelers and three-wheelers grew its revenue by 25 percent.

In addition to their remuneration, both Munjal and Bajaj get dividend for the shares they hold in their companies.

Hero declared a total dividend of Rs 95 per share last year, and Munjal held 32,500 shares in the company as on March 31, 2018.

Bajaj Auto declared a total dividend of Rs 60 per share for the same period, and Bajaj held 7.59 lakh shares as at the end of March.

Growth in domestic sales of both Hero MotoCorp and Bajaj Auto was lower than the industry average last year, as per data shared by the Society of Indian Automobile Manufacturers.

Hero's sales grew 13.8 percent to 7.3 million units, while those of Bajaj fell 1.3 percent to 1.97 million units. Over the same period, the industry grew 14.2 percent to 20.19 million units.

In comparison, Honda Motorcycle and Scooter India (HMSI), which is India's second largest two-wheeler maker, reported a growth of 22.2 percent in domestic sales to 5.77 million units.