Top corporate honcho Mukesh Ambani makes close to Rs 1,000 every second for his flagship company Reliance Industries and, in turn, gets a reward of one per cent.
NEW DELHI: Top corporate honcho Mukesh Ambani makes close to Rs 1,000 every second for his flagship company Reliance Industries and, in turn, gets a reward of one per cent of this additional profit or Rs 10 per second.
The paycheck of Ambani, already richest Indian in world and highest paid corporate chief in India, got fatter by over Rs five crore to Rs 30.46 crore in the financial year 2006-07.
This represents an increase of Rs two per second from his previous fiscal's paycheck of Rs 24.77 crore, reveals RIL's annual report for 2006-07 currently being sent to investors.
However, the hike of more than 20 per cent has come along with a jump of about 32 per cent in RIL's net profit to Rs 11,943 crore in the latest fiscal, as against Rs 9,069 crore in the previous year. The company's turnover also rose by over 32 per cent to Rs 1,18,354 crore in the year.
"RIL has become first and only private sector company to record turnover of over Rs 1,00,000 crore and net profit exceeding Rs 10,000 crore," the company's annual report quoted Ambani as saying.
The company's "excellent performance" has cemented its position as the largest private sector enterprise in terms of revenue, profit, net worth, assets and market cap, he added.
Earlier this month, RIL became India's first company to achieve a market cap of more than Rs 3,00,000 crore.
The hike of over Rs 5 crore in Mukesh Ambani's annual remuneration further extends the gap from the annual paycheck of his younger brother Anil, with whom he separated in June 2005, to more than Rs 27 crore.
Anil's annual pay as chief of four group firms, Reliance Energy, Reliance Communications, Reliance Natural Resources Ltd and Reliance Capital Ltd, totals for less than Rs three crore, according to their annual reports.
In terms of pay per second, Anil Ambani's pay comes out to be about Rs one for the fiscal year 2006-07.
There are about 3.15 crore seconds in a year.
The two brothers were taking equal salary of about Rs 21 crore till they were together. However, Mukesh Ambani's salary has grown much bigger by virtue of higher profits clocked by his company, even though it has cut the percentage of net profit doled out as key managerial payments.
In 2006-07, RIL's salaries and other payments for MD and executive directors was calculated at a rate of 0.402 per cent of net profit. In the previous year it was 0.67 per cent till June 18, 2005, the day the two brothers reached a settlement to go separate ways, and 0.402 per cent per annum thereafter.
Mukesh Ambani was accompanied by two other key top-level executives -- Executive Directors Nikhil Meswani and Hital Meswani -- to get a pay hike. Hardev Singh Kohil, also an Executive Director, however, took a pay cut of about Rs 35 lakh to get Rs 1.15 crore.
Nikhil, responsible for RIL's petrochemicals and polyester businesses, got a hike of Rs 1.46 crore to take his annual paycheck to Rs 7.77 crore. Hital, responsible for petroleum business, also got a similar hike to Rs 7.76 crore in 2006-07.
RIL paid Rs 47.14 crore in total managerial remuneration, up from Rs 44.36 crore in the previous year. Besides, it paid Rs 1 crore in commissions to non-executive directors, half of the Rs two crore paid in 2005-06.
While the salary component came down to Rs 1.3 crore from Rs 1.41 crore in the previous year, the commission rose to Rs 43.59 crore from Rs 40.22 crore.
Payments like perquisites, contribution to provident and superannuation funds, leave salary/encashments and gratuity provision came down, while RIL also took into account sitting fees paid to erstwhile IPCL directors last fiscal.
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