Azvalor and Pabrai's Strategic Bet on Offshore Compounder EquityShares International

In the ever-evolving landscape of offshore value investing, two distinct yet complementary strategies have emerged as compelling case studies: Azvalor Internacional FI's global equity approach and Mohnish Pabrai's concentrated energy bets. While neither fund directly overlaps with EquityShares International's 2025 offshore strategy, their collective focus on undervalued, long-term compounding opportunities underscores a broader trend in the offshore fund space. This analysis explores how these managers are leveraging deep-value principles to capitalize on structural shifts in global markets.

Azvalor's Global Value Playbook

Azvalor Internacional FI, managed by Azvalor Asset Management SGIIC, adheres to a strict value investment philosophy, targeting undervalued equities with a long-term horizon (Azvalor Internacional FI). As of Q4 2024, the fund allocated 10.5% of its portfolio to Noble Corp PLC (NE), a key player in offshore drilling, reflecting its appetite for cyclical energy plays. The fund's strategy is further diversified with European mid-cap stocks like Ryanair Holdings PLC and industrial giants such as Schlumberger Ltd., which it increased by 1,313.48% in share count, according to a GuruFocus article (a GuruFocus article). This approach aligns with EquityShares International's 2025 emphasis on defensive value, particularly in dividend-paying international equities, as seen in ETFs like the Schwab International Dividend Equity ETF (SCHY), noted in a Morningstar piece (a Morningstar piece).

Azvalor's exposure to emerging markets (up to 35%) and its avoidance of derivatives position it as a low-volatility alternative to traditional offshore funds. According to a Financial Times fund page, the fund's 2025 performance has shown resilience in volatile markets, with its energy and industrials sectors outperforming broader indices (FT fund page).

Pabrai's Energy-Centric Concentration

Mohnish Pabrai's Q2 2025 portfolio, managed under Dalal Street LLC, exemplifies a concentrated value strategy. The fund's top holdings-Warrior Met Coal (30.37%), Valaris Ltd. (29.21%), and Alpha Metallurgical Resources (19.06%)-reflect a doubling down on energy and materials sectors, as listed on Mohnish Pabrai's portfolio page (Mohnish Pabrai's portfolio page). Pabrai's recent addition of AutoNation Inc. into the automotive retail space marks a strategic diversification, yet the portfolio remains heavily tilted toward offshore drilling and metallurgical coal (per Dalal Street's holdings summary, Dalal Street portfolio).

This approach mirrors EquityShares International's 2025 focus on high-quality, dividend-driven international equities. For instance, the iShares MSCI International Quality Factor ETF (IQLT), a favored EquityShares vehicle, prioritizes profitability and low debt ratios-traits shared by Pabrai's coal and drilling holdings, as reflected on the iShares IQLT page (iShares IQLT page).

The Offshore Fund Landscape: Synergies and Risks

The offshore fund space in 2025 is characterized by a dual focus on energy transition and traditional value sectors. Azvalor's European-centric, diversified approach contrasts with Pabrai's hyper-concentrated energy bets, yet both align with EquityShares International's broader thesis of capitalizing on undervalued global equities.

A critical factor driving these strategies is the declining U.S. dollar, which has amplified returns for international investments, as an iShares equity outlook notes (an iShares equity outlook). However, policy risks-such as U.S. trade tariffs-remain a wildcard. As noted in BlackRock's 2025 outlook, investors must balance long-term value with macroeconomic uncertainties (BlackRock's 2025 outlook).

Conclusion: Strategic Alignment in a Fragmented Market

While Azvalor and Pabrai's portfolios do not directly overlap with EquityShares International's 2025 strategy, their shared emphasis on deep-value, long-term compounding opportunities highlights a broader trend in offshore investing. By targeting undervalued sectors like energy, industrials, and international equities, these managers are positioning for a market environment where patience and conviction yield outsized returns. For investors seeking high-conviction offshore bets, the interplay between these strategies offers a roadmap for navigating 2025's challenges.