By Park Hyong-ki
Staff Reporter
DAEGU _ Upon arrival, greeted by hundreds of staff of TaeguTec and reporters in this southeastern city, long awaited Warren Buffett, the world famous investor, jumped out of a limousine and waved to the crowd saying, ``It's great to be here, thank you!'' This is his first visit to Korea.
Noted for his brilliance in investment strategies _ knowing which stocks to bet on and gain handsomely _ the 77-year-old ``Oracle of Omaha'' said that his strategies have always been the same.
``We're basically looking for the same thing _ large companies with businesses we can understand and that have a durable competitive advantage,'' said Buffett at a press conference Thursday.
The billionaire investor said Korea still remains undervalued and attractive for investors.
``I don't think there's a bubble in South Korean stocks,'' he said.
He said he was positive about Seoul stocks for at least over the next decade.
``Korea's market is modestly cheaper (than other emerging markets), but it's good for investment.''
He said his investment firm Berkshire Hathaway has invested $500 million to buy a 4 percent stake in POSCO, reasoning that he bought it because the steel company's balance sheets were good compared with its cheap share price when he looked at it.
Like any other day, one word about certain stocks from the world's most influential investor will send those shares skyward. After his brief introduction of Berkshire's investment in POSCO, the steel maker's shares closed higher, Thursday.
He said that Berkshire also previously invested in Kia Motors, Hyundai Motor, Hyundai Steel and Shinyoung Securities but sold all of them with the exception of POSCO. He said he himself holds Korean stock in his personal portfolio, but did not specify the name of the company.
He reserved his opinion about China's equity market since he doesn't follow it often other than saying that the market is showing signs of overshooting even though its fundamentals seem good.
The U.S. investor came to Daegu to visit TaeguTec after attending a ceremony in China where the Iscar Metalworking Companies Group completed the construction of its factory.
TaeguTec, a producer of industrial cutting tools and tungsten powders, is a Korean unit of the IMC Group of which Berkshire Hathaway is the major shareholder with an 80 percent stake. Buffett's investment firm invested $4 billion in IMC, a global manufacturer of metal cutting tools and industrial products headquartered in Israel, last year.
His investments through Berkshire are for the betterment of society. Last year, he surprised the international business community by donating billions of dollars of the company's investment gains to renowned social foundations, including the Bill and Melinda Gates Foundation.
He said his company will continue to abide by its commitment to changing the world, adding that social contribution is a promise, not a promotional scheme.
``Shares (that the firm gained) will go to charity of one sort or another,'' Buffett said proudly. ``Ninety-nine percent will go to charity, to five foundations. Last year one of them was the Bill Gates Foundation since most investment are through Berkshire. And less than 1 percent from my personal investment goes elsewhere.''
The Nebraska-born investor, who has a grandfatherly image, said that he tries not to forecast the future performance of equities when buying stocks, but approaches them seriously based on business fundamentals.
He added that global economic troubles such as subprime lending defaults and slow U.S. growth do not affect his company's investment decisions.
``We always had problems historically. But overall, the (global) economy will progress. Although it does affect consumers and their buying power, it does not affect what we do at Berkshire Hathaway,'' said Buffett.
Influenced by value investor Benjamin Graham, the ``Father of Modern Security Analysis'' or the ``Dean of Wall Street,'' who taught Buffett as a professor at Columbia University for his master's in economics, the 'Oracle' further developed his skills in mathematics and business, which he was already a natural at.
Not everything is only about investing for Buffett though. He enjoys reading for inspiration and maintains good health.
``I drink a lot of Coca-Cola, 5 to 12 ounces a day (to keep healthy) since we have a 8 percent share,'' Buffett said jokingly.
Before his departure from Daegu, he advised people to not take stock investment lightly.
``Always look at stocks as part of a business, which is not a small thing,'' said Buffett.