Public company to pay Rs 6 Cr basic salary plus multiple perks to promoter’s 24-year-old daughter with just two years’ experience as manager!

Of late, Indian capital markets are attracting many a new promoter to float an IPO. There is nothing wrong in new comers and start-ups crowding the market. But, how credible and mature are they?
For instance, the Red Herring Prospectus (RHP) filed by Udayshivakumar Infra Ltd claims that the company was originally formed as a sole proprietorship under the name of M/s Udayshivakumar in August 2002 and was converted into a partnership firm under the same name in March 2014. The partnership firm was converted into a private limited company in December 2019 and it was converted into a public limited company in September 2022. But, according to the official website of the company (http://www.uskinfra.com), Udayshivakumar Infra Ltd was incorporated in the year 1995!
Udayshivakumar was appointed as the Managing Director of the company for a period of five years with effect from January 1, 2020. But, he did not draw any remuneration for the fiscals 2021 and 2022. Pursuant to a resolution passed by the board of directors at the meeting held on September 17, 2022 and approved by the shareholders at the AGM held on September 19, 2022, the terms of remuneration, including salary, allowances and perquisites were fixed which would certainly raise many eyebrows.
The company, whose average annual employee cost was only about Rs 3.5 Cr during the last three fiscals, has proposed a basic salary of up to Rs 50 lakh per month (Rs 6 Cr per annum) with an annual increment of Rs 10 lakh for its promoter-managing director. He will be entitled for performance incentive or commission to a maximum of 2% of the net profit, medical reimbursement, leave travel concession, club fees, personal accident insurance, gratuity, earned leave, provision of car, telephone, etc.
What’s more, the 24-year-old daughter of the promoter-managing director, whose experience is just two years as manager with the company, has been promoted as executive director and she has also been offered the remuneration that her 53-year-old father with more than 20 years of experience has been awarded. This is how promoters treat a public company!