Guru Mohnish Pabrai (Trades, Portfolio), an engineer, investor, author, philanthropist and competitive bridge player, has recently been increasing his holdings in Horsehead Holding Corp. (ZINC, Financial) adding an additional 1,287,178 shares in his portfolio.
Mohnish Pabrai purchased the shares on the following dates at the prices listed below.
- 7,012,953 shares on July 22 at $7.91 per share. +10.73%.
- 7,483,606 shares on July 28 at $8.11 per share. +6.71%.
- 7,890,301 shares on Aug. 3 at $8.12 per share. +5.43%.
- 8,138,582 shares on Aug. 7 at $8.34 per share. +3.15%.
- 8,300,131 shares on Aug. 21 at $7.73 per share. +1.98%.
Pabrai earned a degree in computer engineering but didn’t get into investing until 1994 after he had graduated from South Carolina’s Clemson University. Pabrai has said that "quite by accident" he read Roger Lowenstein's "Buffett: The Making of an American Capitalist." He has also mentioned how lucky he was to have read it because many biographies were coming out about Warren Buffett (Trades, Portfolio) at that particular time and none had previously been released.
Pabrai found that the most compelling part of the book was the quote “I am a better businessman because I am an investor, and I’m a better investor because I am a businessman.”
In the YouTube video below Pabrai talks about one of the first investments he made in 1995, a company in India called Satyam Computer Services. It was trying to expand business in the United States, and its sales team visited Mohnish Pabrai in Chicago and they began to form a relationship together. The sales team members never did any actual business, but Pabrai liked them and studied them, and it blew his mind because the market cap was less than their real estate value in Hyderabad would have been valued at that time. The stock was trading below their liquidation value in real estate which Mohnish Pabrai considered to be phenominal.
"This company was growing 70% per year or something like that," Pabrai said. "I could not really see the end of that runway."
He made a $10,000 purchase and decided to buy and not look at it again for 10 years. It was 40 rupees per share then; five years later it was up to 7.000 rupees. It had gone up 130 to 140 times.
The company, through its subsidiaries, is a producer of specialty zinc and zinc-based products. Horsehead Holding products are used in a variety of applications, including in the galvanizing of fabricated steel products, as components in rubber tires, alkaline batteries, paint, chemicals and pharmaceuticals and as a remelt alloy in the production of stainless steel.
The chart below shows the company's Price To Earnings.
Pabrai shares another passion with Buffett and Munger; he loves to play bridge, stating that he plays five to six hours per week because he loves the game. There is a relationship between bridge and investing similar to the relationship between poker and investing. Buffett, Munger and Pabrai all enjoy playing bridge while Bill Gates (Trades, Portfolio), Carl Icahn (Trades, Portfolio) and legendary oil tycoon H.L. Hunt all enjoyed playing poker.
Pabrai is also a philanthropist, founding the Dakshana Foundation in August 2007. The Dakshana Foundation has helped send more than 600 underprivileged students to university IT programs. Here is the link to his foundation http://dakshana.org/.
Cheers to your investment success.
