95th Birthday of Warren Buffett

95 years as a personage, 70 years as an investor, 63 years as a millionaire, 60 years as the world’s longest serving Chairman, 40 years as a billionaire, 20 years as the world’s largest philanthropist, and 18 years since he got the tag of world’s wealthiest person. This is the biosketch of Warren Edward Buffett.

Warren Buffett is popular because of his company Berkshire Hathaway which is the world’s largest conglomerate cum investment group. Berkshire made direct and indirect investments in 800 plus companies. Its top 5 holdings are American Express, Apple, Bank of America, Coca Cola, and Chevron constituting 67% to 70% of Berkshire’s total investment value. Among its non subsidiary investments, Berkshire holds 21.8% stake of American Express, 27.4% of Kraft Heinz, 28% of Occidental, and 50% of Berkadia. During the 6 months in half year (H1) of FY 2025 ending on 30th June 2025, Berkshire purchased investments of $257 billion, sold investments of $280 billion, and reported a net surplus of $33 bln from investments. It has $198 billion tangible assets and $35 billion intangible assets.

For the half year (H1) ending 30th June 2025, cash from operations of Berkshire is $21 billion. The main three segments of its revenue are BFSI (banking, financial services & insurance) with 35%, consumer products with 34%, and commercial & industrials with 31%. Its effective tax rate is 14%. Berkshire never pays dividends. On the contrary, Berkshire has an open program of share buyback at the discretion of Warren Buffett and the Board so long as minimum cash balance is $30 billion. Berkshire is the world’s largest cash holding entity, presently having cash pile of $360 billion which is 30% of its total balance sheet. Interestingly, GDP of 150 countries is less than the cash pile held by Berkshire.

The present shareholders funds of Berkshire is $670 billion. Its debt is $127 billion which is totally unsecured. Its cost of long term borrowing is benign. The interest cost of USD denominated debt due over 20 years is 3.5%, Pound denominated debt due over 30 years is 2.5%, Euro denominated debt due over 15 years is 1.4%, and Yen denominated debt due over 35 years is 1.1%.  

Berkshire Hathaway was popular for outnumbering S&P index for 30 years, but the margin has been narrowing with S&P outperforming Berkshire in the last 5 years. Market cap of Berkshire is $1.1 trillion. Current market price of each Berkshire A share is $750,000 (~Rs. 6.5 crs). For 30 plus years, Berkshire’s beta has less than 1 indicating lower risk than market. Due to this, despite lower returns compared with market, institutional investors prefer staying invested in Berkshire.

Globally no business news can be seen without covering Berkshire and Warren Buffett. Everything about Warren Buffett is a sensation and every birthday of his is a headline news. He celebrates his birthday modestly but with themes, some known and many unknown. His 50th birthday was celebrated with Pepsi themed cake, his 53rd was celebrated with a significant acquisition, his 75th was celebrated with $100 bill shaped white chocolate cake, and his 76th coinciding with his second marriage.

Buffett announced to retire by the end of year 2025 as Chairman & CEO of Berkshire. His eldest son Howard Graham Buffett will be non-executive chairman and the current Vice President Greg Abel will be the CEO. Buffett has largest number of fan clubs and admirers in the world and particularly among the investors. Therefore, investors and the media celebrate the birthday of Warren Buffett magnificently.

Berkshire’s shareholders, and investors and media around the world are eagerly waiting for the occasion of Warren Buffett’s birthday on 30th August 2025. It is intriguing to see what theme would embed in the 95th birthday of Warren Buffett.

Disclaimer: Dr. Kishore Nuthalapati is an Economist and a Corporate Finance Professional. Dr. Kishore is serving as the CFO of BEKEM Infra Projects Pvt Ltd, Hyderabad, India. Views are his personal and do not reflect those of any of the organizations he is or was associated with.