INSUBCONTINENT EXCLUSIVE:
Warren Buffett's Berkshire Hathaway now owns close to 15% stake in the company.Recently, Warren Buffett's Berkshire Hathaway purchased 18.1
million shares of Occidental Petroleum Corp, the US oil giant.There's an interesting investment case study behind this
Here goes…Buffett's Berkshire Hathaway now owns close to 15% stake in the company and currently ranks as its 8th biggest stock holding
Interestingly, Buffett also owns stake worth $ 6 billion in Chevron, another oil giant.Clearly, Buffett energy bets are perplexing
Especially against the backdrop of a world that will be powered by green energy
Does Buffett not believe in the concept of reducing carbon emissions or are we missing something?Luckily for us, Buffett was asked the very
same question at last year's Berkshire AGM
Here's what he had said."I would say that people that are on the extremes of both sides are a little nuts
I would hate to have all hydrocarbons banned in three years, or you wouldn't want a world that, it wouldn't work
And on the other hand, what's happening will be adapted to, over time, just as we've adapted them to all kinds of things."That's a perfectly
rational reply in my view, something you've come to expect from a legend like Buffett.Buffett argues that you can't have a hydrocarbon free
Likewise, green energy can't become the dominant source in a few years
The transition will take time.Thus, if investors are going ga-ga over green energy stocks and assigning them crazy multiples, you should
stay away from such stocks.Similarly, if investors are becoming negative about energy stocks and dumping them to levels where they become
attractive valuations wise, you can consider investing in them.This is exactly what seems to have happened to Occidental Petroleum
Thus, Buffett saw an opportunity and snapped up the company's shares.The way stocks like ONGC and Oil India have moved over the past few
months, looks like Buffett's mantra would have worked in India as well. By the way, Co-head of Research at Equitymaster Rahul Shah shared
this update on his Telegram channel today.Be a part of Rahul's journey as he shares ideas that can potentially accelerate your profits
Join Rahul's Telegram Channel – Accelerated Profits.Happy Investing!Disclaimer: This article is for information purposes only
It is not a stock recommendation and should not be treated as such
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