Warren BuffettofInvestmentsDecisions have always been in the spotlight, but his recent huge losses in the Indian market have sparked a lot of discussion. According to reportsWarren BuffettsubsidiaryBerkshire HathawayThe company recently won with 1$6.4 billion clearance of India's largest digital payments companypaytmMore than 15.6 million shares。The loss caused by this transaction was as high as 31%, letInvestmentsThey were amazed.
paytmIt is the largest payment platform in India with more than 300 million registered users and 20 million merchants. Founded in 2010, it is growing rapidly in India and gaining a foothold in the field of payment electronics. However, despite thatpaytmIt has attracted much attention in the Indian marketWarren BuffettThe decision to opt for a cut meat clearance was a surprise.
Behind the losses in this transaction are the problems of the Indian market. First of all, the Indian market is highly competitive. Whether it is e-commerce, payment, entertainment or travel, there are first-class warsFlowThere are many domestic and foreign competitors. This makes the company's path to profitability narrow, making it difficult to generate sustainable revenue.
Second, the risk of regulatory uncertainty in the Indian market has also increasedInvestmentsconcerns. In recent years, India** has frequently censored and restricted Chinese companies, which has created great uncertainty for multinational companies. For likeWarren BuffettSuchInvestmentsWho's going to do itPolicy riskis one of the important factors they consider.
paytmThe development has gone through ups and downs, and it spans across IndiaElectronic PaymentsAt a critical moment in the industry, it has achieved great success, but it has also encountered many difficulties.
paytmFounded in 2010 by Vijay Singh Sherma, a simple mobile payment was introducedSoftwareto allow people to pay utility bills such as utility bills from their mobile phones. However, inpaytmFounded in the early days of IndiaInternetThe penetration rate is low, and many people do not have a mobile phone or do not have access to the internet, resulting inpaytmThe number of registered users is relatively small.
However, in 2015 India launched the "Digital India" strategy, promoted byInternetto get more people connected to the network. In 2016, India** once again introduced a policy and announced the "demonetization order", which promoted the rapid development of online payment platforms. paytmSeizing this opportunity, we have worked with a number of partners to achieve explosive growth in user volume and market share.
With the growth of the number of users and the expansion of market share,paytmAttracted many starsInvestmentsof the eyeballs, including:Warren BuffettwithAlibabaClique. However,paytmThe performance in the capital market is not satisfactory. On the first day of listing,paytmThe stock price has been sharply**, and since then it has been facing problems such as uncertain earnings prospects, fierce competition in the industry and overvaluations, and the stock price has continued to fall. AlibabawithWarren BuffettThe sell-off is a testament to their interest in thepaytmUncertainty about the outlook.
Not only thatpaytmWarren Buffettin the field of payment electronicsInvestmentsAlmost all of them failed. According to reportsWarren BuffettofInvestmentsinstitutionsBerkshire HathawayBanner alsoInvestmentsST, a digital payments company in BraziloneHowever, the company's share price has also continued to be **, with a cumulative decline of more than 53% so far.
It can be seen,Warren BuffettofInvestmentsThe strategy has not been successful in the field of payment electronics. This has to do with hisValue investingThe idea is contradictory,Value investingThe focus is on stable cash flow and long-term growth potential, while companies in the payment electronics space often need a lot of capital support and short-term growth. This makesWarren BuffettIt was difficult to find a match for himInvestmentsStrategies for paymentElectronics company
Finally,Warren BuffettThe huge loss in the Indian market has raised eyebrows in the Indian market. As one of the world's largest emerging markets, India has attracted a lot of peopleInvestmentsThe gaze of the people. However, fierce competition and policy uncertainty in the Indian market have given itInvestmentsThe risks are enormous. For likeWarren BuffettSuchValue investingfor the Indian marketInvestmentsDecisions need to be carefully weighed.