Hari Ramachandra  01:45

This is interesting. I came here for camping. This is called the Russian River out here in Northern California, a couple of hours drive from San Francisco. And I thought I’ll have reception everywhere. So, I should not have any problem. Next thing I figured out that AT&T has no coverage, so for all your investors thinking of investing in AT&T or Verizon, this is a litmus test.

Preston Pysh  02:10

Is the guy whom you stole his phone because you had the other wrong service. So, you find a guy that has Verizon, he lent you his phone. Is he staring at you right now? Is he like giving you the mad dog as you’re talking to us?

Hari Ramachandra  02:20

No. He’s having his coffee and enjoying it while I’m talking to you guys and I probably will buy him that coffee.

Preston Pysh  02:27

Oh my god. Yeah, that and more. Well, please give him our best. And I’m sure if you can tell him the name of our show. He can listen to this and be very proud that he lent the phone for this to happen. We must have Hari on the line today because Hari last weekend was at Mohnish Pabrai’s Shareholders Meeting and he’s going to talk to us about being there. But we’re going to have to drop Hari off the phone so he doesn’t run into some issues with this guy who’s lending him his phone.

So Hari, tell us about the shareholders meeting that Pabrai put on. I’m really curious to hear what’s going on with the holding company that we know he was going to try to get going here in 2015. So, lay it on us.

Hari Ramachandra  03:06

So this is my second visit to the Pabrai annual meeting. Now he calls it the Dhandho and Pabrai Friends Annual Meeting. As usual, Pabrai was a great host. The format was typical, the same as last year. We had an initial meet and greet for the first half an hour where we could talk to Pabrai. And I also met Guy Spier. And it was great fun chatting with him and catching up with him.

After the initial meet and greet, Pabrai has his presentation for almost an hour. He talks about what he thinks about the current economic conditions, the markets, as well as a quick review of his fund performance, followed by a post mortem of some of the previous investments.

Preston Pysh  03:53

So sorry to interrupt but I’m curious to know how his fund has performed in the last year.

Hari Ramachandra  03:57

So that is information he requests not to make public. So, it’s only for his investors. And since I was there as a guest, so I will not comment on the performance.

Preston Pysh  04:09

Yeah, we don’t want to get you into trouble.

Hari Ramachandra  04:10

So what I think most of the listeners will be interested in is about Dhandho, Dhandho Holdings that he *inaudible last year, and there were rumors that it will go public this year. A quick summary of Dhandho Holdings is that it’s not going to go public this year. And Pabrai did not give us any date. However, there were a couple of things he announced. One of the things is that he has opened an office of Dhandho Holdings in India. And he’s also planning to start n  ETF based on value investing principles. He is going to call it Junoon. The principles are very similar to what Toby has talked about in the past. So, there is a certain quantitative analysis that goes into this ETF.

Preston Pysh  04:57

So at the end of the day, Hari, I’m curious, is he going in this direction where he’s just going to have an ETF and that’s going to be really the path forward? Or is he ultimately going to still do the Dhandho Holding but it’s just delayed probably because of the current market conditions? And I know you might not be able to comment on that. But is he still pursuing starting his own holding company and going down the same path that Warren Buffett went?

Hari Ramachandra  05:20

I believe so because he has already purchased Stonetrust Insurance, which is a working company insurance company, a wholly-owned subsidiary of Dhandho Holdings. ETF is going to be one of the activities that Dhandho Holdings will be involved in. From what I heard, he is interested in buying off companies completely like a subsidiary, but at this point, he has identified multiple opportunities where Dhandho Holdings can be involved.

Preston Pysh  05:50

So I just want to give some context that some of the newer listeners that maybe haven’t been following the show since the very beginning. So, Mohnish Pabrai is a very close follower of Warren Buffett. Mohnish’s returns over the last 10, 15 years have been monumental. Hari, do you know how big the returns have been over as the last decade? I want to say it’s close like 1,000%.

Hari Ramachandra  06:12

Yes. And *annualized rate that I want to be 19 to 20% for some of the funds since inception. So, so far he’s up there.

Preston Pysh  06:21

Yeah, he’s really close to the same return level as Buffett, around the 19 to 20% annualized rate. So, this is somebody that we follow very close attention to. We really like to form our opinions on maybe where the markets going, some ways that he invests, and just talk about that on the show because he’s just such a brilliant mind when it comes to investing.

So here’s my opinion, and I wasn’t at the shareholders meeting so I’m not you know, obliged to anything. But I really think that he, and I don’t really want Hari to comment because I know that Hari is in a tricky situation attending the meeting. So, Hari  please don’t comment because we don’t want to get you in trouble with Monhnish but my opinion is Mohnish is holding off because he doesn’t want to have an IPO right now and have a bunch of people buy his stock for the IPO. If this thing goes south and he has a bunch of people mad at him and just not happy. And then it just could get worse from there.

Tobias Carlisle  07:09

Yeah, it’s one of the great challenges of running businesses like that, that you have the best times to raise money or the worst times to deploy money. He is probably got a big enough name that he’s able to hold off to a worse time and then there’ll be a better opportunity to deploy it.