Billionaire investor Warren Buffett has been on a selling spree lately. His investment company Berkshire Hathaway sold stocks worth $1 billion more than it bought in the last quarter.
As a result, the company is sitting on a record cash pile of $122.38 billion.
This is well above the market cap of India's top firm, Tata Consultancy Services (TCS), which stood at $121.23 billion on the day of the last reported cash position of Berkshire. As of August 6, 2019, TCS has a market cap of Rs 8.30 lakh crore (or $117.38 billion).
However, this is not the first time Berkshire's cash pile has exceeded the market cap of TCS, or RIL, who has overtaken the former on a number of occasions in the past to emerge as India's most valued firm.
In the past, Buffett has made his distaste for cash known. Berkshire used to maintain cash of about $60 billion odd for several years till 2016. Since 2017, this has jumped to around or above $100 billion.
So why is the 88-year-old investor, who spent a better part of last year building a substantial stake in Apple and pumping billions of dollars in major US banks, maintaining high cash?
Over the decades, Buffett has built a reputation of being a value investor. This means that he likes investing in companies with strong balance sheets that are trading below their intrinsic value and can be held with a long-term horizon.
To put it another way, the increasing cash surplus Berkshire is sitting on probably means that Buffett and his investment managers are not finding good opportunities.
This hasn’t stopped the legion of Buffett followers in speculating what the Oracle of Omaha would do next. Earlier this year, Wells Fargo released a list of companies that could make it to Buffett's shopping list as he continues the hunt for an "elephant-sized acquisition."
These include NASDAQ-listed Cognizant, which has significant operations in India.
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