Warren Buffett, renowned US investor and world’s third richest man has admitted that investing in Tesco was a “huge mistake.”

The influential investor has a 3.7% stake in Tesco, however the value of Buffett’s stake has reportedly fallen by about $750m (£465m) this year, according to The Guardian.

The supermarket’s share prices fell to an 11 year low this year, following investigation into its shock profit error.

Buffett told CNBC, the US television network: "I made a mistake on Tesco. That was a huge mistake by me."

The legendary stockpicker’s portfolio of investments includes names like Coca-Cola, IBM and American Express.

He first bought a stake in Tesco in 2006. At its peak Buffett owned 5% of the business in 2012, but that has since fallen to 3.7%.

Tesco has been struggling in the supermarket war, as sales have dropped amid competition from discounters like Aldi and Lidl.

Tesco has seen declining sales amid increased competition from discount retailers like Aldi and Lidl, and growth of high-end offerings from Marks & Spencer and Waitrose.

Meanwhile, sUK fund manager Neil Woodford – who sold his stake in Tesco in 2012 after its first profit warning – said last week it could be a long time before British Supermarkets became good investment prospects again.