Buffett Comes With Big Appetite for Indian Cos

India a large market, not an emerging one, says the world's third-richest man As The World's Top Investor Comes Calling For The First Time To Tap Indians' Philanthropic Instincts, The Boss Of The World's Second-Largest PC Maker Reaffirms His Faith In The Country

Billionaire investor Warren Buffett said he is looking forward to using the enormous cash pile of flagship firm Berkshire Hathaway to acquire companies in India, which he described as a large, and not an emerging, market.
"I guess you will have to regard me as a bit retarded. I should have been here much sooner. I have been sort of a stay-at-home fellow for most of my life," the 80-year-old said to a packed room of mediapersons on his first visit to India that began Tuesday afternoon. "Better late than never," he quipped.
The Omaha, Nebraska-based Berkshire has made two large acquisitions in the past one year, buying chemicals additive firm Lubrizol for about $9 billion a few days ago and railroad firm Burlington Northern Santa Fe for about $26.5 billion last year. The cash pile on its books is estimated at $38.2 billion. "The elephant gun has been reloaded," Buffett told investors some months ago, hinting at major purchases.
"I do not consider India as an emerging market. It is a large market," he said on Tuesday, adding he hopes to spend some money here. Buffett will also use the India visit to join his billionaire friend and Microsoft founder Bill Gates on a mission to push wealthy Indians to pledge money for a global philanthropic drive called the 'Giving Pledge'.
Witty, down-to-earth and very unassuming, he showered praises on Ajit Jain, the Indian head of Berkshire's re-insurance business who, Buffett said, had made more money for the company than the legendary investor himself.
"He (Jain) could have made a lot more money working for someone else than working for Berkshire, but he is unbelievably loyal and hardworking and unbelievably smart. After he worked for me for a couple of years, I wrote to his parents and said, if you have got one more like him, send him over because I could use him," said Buffett. Jain has for long been considered as one of the potential successors to Buffett. "I owe the people of India an enormous amount for sending me a person like Ajit Jain," he said. On Thursday, after wrapping up his Bangalore visit, Buffett will fly to Delhi, where he will hold a joint press conference with Gates and then speak with some leading CEOs on the philanthropy initiative. Later, in the afternoon, he is expected to meet Prime Minister Manmohan Singh.
"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," said Buffett. Philanthropy More Difficult Than Business
Buffett said philanthropy is much more difficult than business but that does not mean you ignore it. Buffett has pledged nearly 99% of his personal net worth of $50 billion to the Bill and Melinda Gates Foundation. "In China, we talked to 50 to 60 billionaires and we were astounded that frankly one after the other people talked about the same things they talk about in the US. They talked about their family, their businesses, their hopes, their fears," said Buffett, who said there was no real agenda in India apart from seeing a debate on the different ways of doing philanthropy.
Leading Indian CEOs like Analjit Singh of Max India and Shiv Nadar of HCL Tech, Planning Commission Deputy Chairman Montek Singh Ahluwalia, investor Rakesh Jhunjhunwala, the Munjals of the Hero group, UIDAI Chairman Nandan Nilekani, and National Security Advisor SS Menon are among the many expected to meet Buffett in Delhi. "I have never given up a meal to give away money, I have never given up a movie, I have never given up taking my family on a vacation trip so I have everything in the world that I could possibly want. And yet I have a lot left over, that money will do nothing for me, it will do a lot for other people, so I am giving up something that has no value to me and that has value to other people and to me that makes nothing but sense," he said, adding the decision to give most of his money to charity was taken while he and his late wife Susan were still in their twenties. "I felt it was better to be giving away billions later on than millions early on and so far it has worked out that way," he added. Buffett, who chose to start his maiden India trip by visiting Bangalore, said he remained a great believer in global trade despite the political rhetoric against outsourcing and general fear about India taking away American jobs. "There are 309 million Americans; some people will feel anything is threat, whether its India, China or Japan, you name it. But I am an enormous believer in trade. The more trade the world has, the better it is over time," he said. The famous conservatism that Buffett brings to bear on his investment decisions was on display as he doled out advice to investors looking to make returns from the stock market. "Don't get outside of what I call your circle of confidence. Don't try and buy and sell actively. I don't know how to do it," he said.
Buffett begins his maiden India trip with a visit to metal-cutting tools maker TaeguTec India Pvt Ltd—his only investment in the country till date—on Wednesday. His other major India connection is the recent tie-up with Bajaj Allianz to sell auto insurance policies. "We do not have an insurance company here now. We have an agency, it would be more attractive to us if we could buy more than 26% of a company. You put the same amount of effort into a company you own 26% in and in the company you own 50% or 75%," he said, adding in the near term, his firm would continue to operate as an agency in the insurance business in India.
Buffett tried to soothe frayed investor nerves after the twin jolt to the global economy in the form of the Japan devastation and Libyan bombings by saying economies "will march forward" despite interruptions. "My children will live better than I do. My grandchildren will live better than my children. That's been the history of the market society." In response to a question on how he views the accusation of insider trading in the US against Rajat Gupta, former McKinsey chief, Buffett said, "There have been allegations made but in America and most of the world, you are innocent until proven guilty and eventually a jury will decide what the true facts of the case will be," adding he would be following the trial that could last three to six months. "It's an interesting story no question about that," he added.

THE ELEPHANT GUN'S RELOADED: In Bangalore on his first Indian visit, Warren Buffett says he should have been here much sooner