Warren Buffet in India and what he said

Warren Buffet, the world renowned investor, on his visit to India talked about various things. Following is summary of his interviews,

Buffett started his visit on 22^nd March, 2011 in India.

Buffets’s visit marks the entry of Berkshire Hathaway the holding company of several businesses, insurance being main business; the alliance with Bajaj-Allianze Insurance.

Berkshire India, a majority-owned unit of Berkshire Hathaway Inc. has been incorporated to sell and distribute general insurance products in India through their online distribution portal.

Berkshire India will sell insurance directly to the consumer by utilizing the internet portal (berkshireinsurance. com) and tele-marketing. Initially, the focus will be on Motor Insurance, but the Company will continuously update its business model to meet the needs of the fast evolving Indian insurance sector.

He will also engage with Bill Gates, in a ‘Giving Pledge’ drive, meet Wealthy Indians.

Warren Buffet in India and what he said:

He said, business men should not get tempted away to diversify and run into more businesses because boredom and excess cash. It I better that they focus on their businesses in expanding them.

He also mentioned that now when Berkshire Hathaway is USD200 Bln Company, so they would look for big acquisition than smaller ones. They will think how to get to USD300 or USD400 bln mark.

Mentioning his biggest challenge in life, Buffett humorously illustrated how he has public speaking fear and how he joined a public speaking course and then succeeded in proposing his wife.

On speaking about nuclear, he said the USA is going to see a lot of activity in this space in next 5 years. He said he is a proponent to nuclear. But we have to learn how to do better with it. He also added that human is a very capable race and we continuing doing things better and better. Going forward, there will be better power generation profiles than are now.

Buffett, said India is a large market, rather than an emerging market. And he is looking at acquisition using large cash piles that BH has.

He added that others must have thought himself as retarded to come so late to India.

He mentioned he is looking only at big businesses, and India has got many of them. He also mentioned he might be interested in automobile sector in India in future if someone calls him. He mentioned he is interested in a host of things. He receives calls and meets people get to know the people who are running the businesses and he see how are the reputation of the people in charge is.

Buffett praising, Ajit Jain, the head of reinsurance business, said he has made more money to BH than himself. He added that “I owe the people of India an enormous amount for sending me a person like Ajit Jain”

He said it is fun when you don’t know the whole game plan. He wakes up every morning and believes something new will come up. And so it does many times. He said, his goal is not an end or a destination. His success, achievement and enjoyment lies in everyday work. It is like a journey. He also said he has to keep within his field of competence, but do not want to narrow it down to this sector or that sector. I have always been doing what I loved and so it’s never been that if I want to get there to some next plateau then I will be happy.  I have been happy as I go along and it’s been a work in progress. It will never end. Berkshire is an organization will grow beyond my lifetime. I just know if I keep showing up, good things will happen.

He singled to stay away from textile sector due to losses in past.

He said, the Japan crisis would affect the world but now significantly. The rest of the world will continue doing better. The global trade has proved to be a panacea in diversifying activities of businesses. He said we have businesses that do business in more than 100 countries and we see practically every place except in residential construction in the United States. We see growth occurring throughout the world and thought the Japan tragedy interrupts Japan for a period although it will come back strong. It will not take the rest of the world off-track.

He mentioned that he has interests in electronics businesses in Asia, and he is seeing a huge growth. People are buying and more and more using electronic devices. He said that user of electronic gadgets are continue growing in Asia and Europe.

He mentioned TaeguTec, to show how innovation based businesses are doing better.

He also said that the output of the world a year from now will be up significantly up from what it is now, on per capita basis. It’s been happening for two years and it will continue.

He mentioned interest rate policy in USA is worn out.  Then he adds giving example of Steve Jobs, that you can measure interest rates and deficits but the one you cannot measure, most importantly, is the human spirit that wants to do something better tomorrow than the day before.

Answering a question about succession, he said that has been decided, but he has not yet declared.

Talking about his investments in BYD, and electric battery automobile firm, he said it was Charlie Mungar, his partner, and that he has never made a mistake when Charlie is there.

He said that he doesn’t have to be smart every time at everything. He has got people who are smarter than him at a lot of aspects.

He said in India, the automobile sector is well established and controlled. He added that if any of them want to be a part of Berkshire Hathaway, then he is just a phone call away.

Talking about global trade, he said earlier there was a lot of resistance for global trade but now the import in USA 16% of GDP against 5% in 1970, and exports 12% from 6% in 1970. He mentioned good prevailed in past, and they will in net 20-50 years. He added that Americans are living better life than they were in 1970, due to this increased global trade.

He said, he is open for being educated. If some business people want to come to him and do business then he will listen to them and try to understand the businesses, and see if he can involve in it.

Talking about his philanthropic drive, he said that "If you open a restaurant, and the public doesn't like your food, you will know. If you do the wrong things in philanthropy, you don't get a feedback from the market system,"