Jefferies has reshuffled its India portfolio, removing HDFC Bank, PolicyBazaar and REC Limited while adding MCX, Lenskart Solutions and Bajaj Finance. The latest changes reflect the global brokerage’s increasing focus on India’s domestic growth story at a time when foreign investor sentiment towards Indian equities appears to be improving.
The portfolio changes were outlined in Jefferies’ latest Greed & Fear note, which highlighted a shift in market positioning after months of sustained foreign selling in Indian stocks.
HDFC Bank, PolicyBazaar and REC Removed
HDFC Bank, PolicyBazaar and REC Limited have been dropped from the Jefferies India portfolio.
Despite its exit, REC has delivered a strong performance since being added to the portfolio in December 2022. According to the note, the stock generated a return of around 228% in rupee terms during that period.
The changes come as Jefferies adjusts its portfolio to capture new opportunities in sectors linked to India’s expanding domestic economy and financial markets.
MCX and Lenskart Join the Portfolio
Multi Commodity Exchange of India (MCX) and eyewear retailer Lenskart Solutions have replaced HDFC Bank and PolicyBazaar in the portfolio.
Jefferies’ India research team, led by Prakhar Sharma, has maintained a positive view on MCX. The brokerage sees significant opportunities for the exchange in terms of new products and deeper market penetration, supporting its constructive outlook on the stock.
Lenskart’s inclusion, meanwhile, adds another consumer-focused growth company to the portfolio as domestic consumption continues to remain an important theme for investors.
Bajaj Finance Replaces REC
Bajaj Finance has been brought back into the Jefferies portfolio, replacing REC.
Interestingly, this is not the first time the non-banking financial company has been included in the portfolio. Jefferies had removed Bajaj Finance in January 2024, but the stock has gained around 49% since then.
During an earlier period, when Bajaj Finance was part of the portfolio between May 2015 and March 2020, the stock had delivered an impressive appreciation of about 551%.
The decision to add the NBFC again reflects Jefferies’ continued confidence in the broader domestic credit growth theme.
Eternal’s Weighting Increased, Bharti Airtel Trimmed
Jefferies has also increased the portfolio weighting of Eternal, formerly known as Zomato, by one percentage point.
The additional allocation has been funded by reducing the portfolio’s exposure to Bharti Airtel.
The adjustment suggests a stronger preference for Eternal within the current portfolio strategy while retaining Bharti Airtel as part of the investment basket.
India Remains Jefferies’ Preferred Asia-Pacific Market
Jefferies continues to maintain a positive stance on India within the Asia-Pacific region excluding Japan.
The portfolio has an India allocation of 12%, compared with the benchmark weighting of 11.4%. While the overweight position is relatively modest, it signals a deliberate preference for Indian equities.
The positive view is supported by strong domestic economic activity, particularly in the credit market.
Bank Credit Growth Supports India’s Domestic Growth Story
India’s banking sector has witnessed a sharp acceleration in credit growth, with overall bank lending rising in the range of 17% to 18%—the fastest pace seen in more than a decade.
Corporate lending has been growing at around 20% year-on-year, ahead of agricultural loans at approximately 17% and retail credit growth of about 16%.
The strong expansion in lending has strengthened the case for companies that are expected to benefit from India’s continuing domestic economic growth.
Foreign Investors Show Signs of Returning to Indian Equities
Foreign portfolio investors had largely remained cautious about Indian equities for much of 2026, with year-to-date outflows reflecting sustained selling pressure.
However, July has provided the first meaningful indication that sentiment could be changing.
After remaining net sellers for several months, foreign investors have reportedly started returning as net buyers, raising hopes that the prolonged phase of overseas selling may be beginning to ease.
For global brokerages and market participants, the turnaround in foreign flows will be closely watched in the coming months.
The Bottom Line
Jefferies’ latest India portfolio reshuffle reflects a continued focus on domestic growth opportunities. The brokerage has removed HDFC Bank, PolicyBazaar and REC while bringing in MCX, Lenskart Solutions and Bajaj Finance.
With Eternal’s weighting increased and Bharti Airtel’s allocation trimmed, the portfolio adjustments highlight changing sector preferences. At the same time, improving foreign investor flows and strong bank credit growth could provide additional support to the broader outlook for Indian equities.