Berkshire Hathaway has sold its shares in One97 Communications (NSE: PAYTM), the parent company of Paytm, incurring around 40% loss on an investment made over five years ago.
This decision followed a series of sell-offs from other firms, including Alibaba Group (NASDAQ: BABA) and Japanese conglomerate SoftBank Group.
Back in 2018, Warren Buffett’s firm invested approximately $260 million in Paytm, securing a 3% stake in the financial services startup when it carried a valuation of around $10 billion.
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The investment giant — which sold a stake worth $36 million in Paytm in 2021, at a profit — sold its remainder position today for $121.6 million, according to disclosure by the local Indian stock exchange.
In its first-ever direct startup investment in India, Warren Buffett’s Berkshire Hathaway exits Paytm at a 40% loss.
Paytm, having made its initial public offering (IPO) in 2021 at $25.8 per share, faced a dip to as low as $5.58 a year ago.
However, the Indian firm has since rebounded, closing on Friday at $10.73 per share, following robust revenue growth and improved financial performance in recent quarters, and Vijay Shekhar Sharma, Paytm’s CEO, had expressed openness to increasing his stake in the company.
Buffett’s portfolio’s 5-year performance
Since 2018, the value of Warren Buffett’s portfolio has increased by 60%, notably higher than the 49% gains recorded by the S&P 500 index over the same period, according to stock trader guru Gurgavin’s calculations.
Apple (NASDAQ: AAPL) constitutes Warren Buffett’s largest holding by a significant margin, representing 51% of his portfolio. With such a substantial portion, this blue-chip stock is likely the key factor behind Buffett’s success.
Over the last five years, the value of AAPL has experienced an impressive surge, climbing over 200% from $56 per share in October 2018 to its current price of $189.39.
The stock is just shy of its all-time high reached in July 2023, suggesting there is more growth room for the tech giant’s shares once macroeconomic conditions become more favorable.
According to Gurgavin, other stocks that capture a notable percentage of Buffett’s portfolio include Bank of America (NYSE: BAC) at 8.5%, American Express (NYSE: AXP) at 7.6%, Coca-Cola (NYSE: KO) at 7%, and Chevron (NYSE: CVX) at 5.5%
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