Jefferies' Chris Wood Shifts India Bets: Out with HDFC Bank, In with MCX, Lenskart

Jefferies' influential global equity strategist, Christopher Wood, has executed a significant overhaul of his India long-only portfolio, removing heavyweight HDFC Bank, alongside PB Fintech and REC Limited, to make way for new bets on Multi Commodity Exchange of India (MCX), Lenskart Solutions, and Bajaj Finance. This portfolio reshuffle, detailed in his latest 'GREED & fear' note, signals a strong conviction in India's domestic growth narrative and a tactical shift away from certain financial and tech plays. The move comes as foreign portfolio investors (FPIs) turned net buyers in Indian equities during July 2026, pumping in around $2.45 billion, after months of outflows. Wood's strategy is bolstered by India's accelerating bank credit growth, which hit 17-18% year-on-year in 2026, the fastest in over a decade, with corporate lending leading the charge. The perceived 'reverse AI trade,' where global investors are moving capital from overheated AI-linked tech stocks to stable, high-growth alternatives like India, also plays a key role. Meanwhile, HDFC Bank has seen its shares decline by over 25% since December 2025 due to governance concerns and missed earnings estimates. With Jefferies increasing its India weighting to 12% in its Asia Pacific ex-Japan portfolio, market watchers will be keen to see if other institutional investors follow Wood's lead, especially given the ongoing positive FPI sentiment and the Reserve Bank of India's efforts to ensure rupee stability. The new additions, MCX and Lenskart, both showing strong recent performance and growth prospects, are expected to benefit from India's robust domestic demand and improving corporate fundamentals. This reallocation underscores a broader belief in India's long-term economic resilience, suggesting a continued focus on sectors tied to internal consumption and core economic infrastructure.