Warren Buffett /Bloomberg

Famous investor Warren Buffett has made huge profits by increasing stakes in POSCO during the global financial crisis in 2008.

In a letter to his shareholders, Buffett said Berkshire Hathaway earned US$1,324 million in appraisal profits as of the end of 2009 from some 3.94 million shares, or 5.2 percent, it owns in POSCO.

It was only in 2006 that Buffett disclosed his holding of POSCO shares to the public for the first time. He gained more than 100 percent profits by buying 3.48 million POSCO shares for $164 per share on average.

Following a boom in the iron and steel business afterwards, the POSCO share price skyrocketed, and Berkshire's rate of return on POSCO shares soared to 273 percent in 2007. But in the wake of the collapse of Lehman Brothers in 2008, POSCO's stock fell by half from between W500,000 and W600,000, and Berkshire consequently saw the return rate plummet to 55 percent. But Buffett additionally bought about 460,000 shares of the Korean steelmaker.

Last year, the POSCO share price rallied to the W500,000 and W600,000 level. As a result, the value of his POSCO shares soared to $2,092 million, up from $1,191 million year-on-year.