Limaye to get Rs 8 crore package at NSE; EGM called next month

Leading stock exchange NSE has proposed a pay package of Rs 8 crore per annum for its new chief Vikram Limaye and will seek approval of its shareholders on March 7 for his appointment and remuneration package.

At an extraordinary general meeting of shareholders, the National Stock Exchange will seek their approval for Limaye's appointment as MD and CEO for five years.

Recently, NSE's board approved the appointment, which is also subject to clearance from the market regulator Sebi.

NSE will also seek the shareholders' nod at the EGM for the remuneration package to be paid to Limaye, who is joining the exchange from IDFC Ltd.

As per the EGM notice sent to the shareholders, the compensation package payable to him would include a 'fixed pay' component of little over Rs 6 crore per annum and 'variable pay' of Rs 2 crore per year, taking the 'total pay' to about Rs 8 crore.

This variable pay of 25 per cent of total pay is as per a 'median performance level' of 'A-'. There are five grades of performance level, namely A+, A, A-, B+ and B.

If an employee's performance is rated above the median performance level, the payout could be 120 per cent (for A+) or 110 per cent (for A rating). If an employee is rated below the median performance level, the variable payout would be 90 per cent for B+ or even zero per cent at 'B' level.

The variable pay component cannot exceed one-third of the total pay while 50 per cent of variable pay would be paid on a deferred basis after three years.

ESOPs and other equity-linked instruments will not form part of the pay package while the terms of compensation would have "malus and clawback arrangements".

The fixed pay would include basic salary, house rent allowance, special allowance, leave travel allowance, medical allowance, lunch subsidy, contribution to provident fund, gratuity and superannuation and pension schemes.

Fixed pay would not include certain perquisites like company-maintained car with driver, telephone (besides mobile phone), leave encashment, club membership, medical and personal accident insurance cover, the notice said.

Giving further details of Limaye's salary, NSE said he would be entitled to a salary of Rs 15 lakh per month and the board would decide the annual increment. He would also get a special allowance of Rs 21.93 lakh, including Rs 2.25 lakh in lieu of contribution to superannuation scheme.

He will not get any sitting fee during his tenure.

If the company has no profits or its profits are inadequate in any financial year, the monthly remuneration payable cannot exceed the limits specified under the Companies Act.

His appointment comes at a time when the exchange is preparing to launch its IPO estimated to be worth over Rs 10,000 crore. Besides, the bourse is facing regulatory issues over alleged preferential access to a few in co-location case.

He was with IDFC since 2005 and has over 25 years of experience of working with financial institutions, banks and accounting firms.

The NSE board, chaired by Ashok Chawla, approved his appointment after a 4-member search panel suggested Limaye's name from among the short-listed candidates.

The appointment came nearly two months after Chitra Ramkrishna made a sudden exit from the post of NSE's chief in December last year for "personal reasons".

She had risen through the ranks to head the exchange and was part of the team that set up NSE in 1992. Her tenure was originally scheduled to end in March 2018.