5 months ago
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According to their company's filings with the ministry of corporate affairs (MCA), Nithin Kamath and Nikhil Kamath – founders of investment firm Zerodha – drew in an annual salary of ₹72 crore each in Financial Year 2023 (FY23).
Zerodha co-founder Nithin Kamath explains his whopping ₹72 crore salary.(Mint file photo) This sparked yet another debate about the extremely high salaries of executives and top management in start-up companies, while employees have less than a fraction of their annual packages.
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For FY23, the Kamath brothers are at the top spot for the annual salary packages of start-up owners, while OYO CEO Ritesh Agarwal is at the second spot with an annual salary of ₹12 crore.
Two years ago, the salaries of both Nithin and Nikhil Kamath were stated as ₹100 crore, as per their company filings. Issuing a clarification around the same, Nithin Kamath had revealed that this is not the actual salary that the brothers drew in.
While the Kamath brothers have both drawn in ₹100 crore as the directors at Zerodha, CEO Nithin's wife Seema Patil's remuneration was ₹36 crore.
Zerodha CEO Nithin Kamath clarified extremely high salaries
In 2021, Nithin Kamath explained why the board of Zerodha had approved ₹100 crore salary for both him and his brothers. He revealed that this was not their actual drawn-in salary, and nearly half of it went out in taxes.
"Firstly the reported figure isn’t the actual salary being drawn. This is an enabling resolution that allows us as working promoters to draw salaries up to the number in case of liquidity requirements. Didn’t anticipate that this would get this much attention," Kamath had written on social media.
Highlighting the importance of taxes, he had also said, "While the actual salary will be lower, it will still be high compared to the norm. Promoters don't take out profits through salaries as it is tax-inefficient, you end up almost paying 50% in taxes."
As per their report, the employee benefit cost of Zerodha was recorded at ₹623 crore in FY23, with ₹380 crore given in salaries, while the rest was used in ESOPs settlements.
