Chris Wood Shakes Up Jefferies’ India Portfolio: Exits Reliance, Bets on Adani 🚀
Chris Wood, Jefferies’ Global Head of Equity Strategy, has made a bold move in his India-focused portfolio, dropping business giant Reliance Industries and adding Adani Group stocks, notably Ambuja Cements and Adani Ports. This shift, detailed in Jefferies’ latest portfolio update, signals a fresh direction for the firm’s market strategy in India, grabbing attention from institutional investors and analysts eager to spot the next big trend in Indian equities.
Why Ditch Reliance? 🧐
Reliance Industries, a cornerstone of Jefferies’ India portfolio with a prior 5% weighting, was removed shortly after its annual general meeting (AGM) in late August. The AGM unveiled ambitious plans, including a push into ai via a new subsidiary, Reliance Intelligence, and a goal to hit ₹1 lakh crore in FMCG revenue. However, investor concerns about the upcoming Jio Platforms IPO in 2026 and potential “holding company” discounts likely influenced Wood’s decision to exit. These risks, tied to the IPO’s structure, raised questions about Reliance’s short-term upside, prompting Jefferies to redirect capital elsewhere [economictimes, livemint].
Adani Stocks Take Center Stage 🌟
Filling the void, Wood has boosted exposure to Adani Group stocks. Ambuja Cements, now holding a 4% weighting, joins Adani Ports, which commands a 6% share in the India long-only portfolio. The addition of Ambuja aligns with a recent GST rate cut on cement from 28% to 18%, effective September, which has improved sector profitability. Analysts, including HSBC, have upgraded Ambuja to a ‘buy’ rating, citing cost savings from new clinker kilns, successful post-acquisition integration, and industry consolidation driven by M&A activity and capacity expansion. These factors enhance pricing discipline and operational efficiency, making Ambuja a compelling pick [ndtvprofit, financialexpress].
Portfolio Rebalancing: New Players, Trimmed Holdings 🔄
Wood’s Greed & Fear newsletter details the reallocation, funded by exiting Reliance and Axis Bank while trimming positions in ICICI Bank, REC, and JSW Energy by one percentage point each. New additions include Ambuja Cements, Le Travenues Technology (Ixigo), and Lemon Tree Hotels, each assigned a 4% weighting. The revamped portfolio now spans 23 stocks, with significant allocations to Adani Ports, SBI Life Insurance, DLF, Macrotech Developers, and Bharti Airtel, reflecting a diversified yet growth-focused approach [livemint, thebonus].
Case Study: Ambuja’s Timely Boost 📈
The addition of Ambuja Cements highlights Jefferies’ knack for capitalizing on regulatory shifts. Post-GST cut, Ambuja saw a surge in institutional interest, with HSBC upgrading the stock due to cost efficiencies and industry consolidation. This move underscores how policy changes can create competitive edges for well-positioned companies, reinforcing Wood’s high-conviction bet on Adani’s cement economy play [economictimes].
What This Means for India’s Market Strategy 🔮
Wood’s shift from Reliance’s sprawling conglomerate to Adani’s sector-focused businesses signals a broader trend. By favoring agile, industry-specific players benefiting from regulatory tailwinds and consolidation, Jefferies is betting that India’s Fintech Tools and calculator-driven market outperformance in 2025 will hinge on such companies. This repositioning could prompt other asset managers to rethink their allocations, prioritizing nimble firms over legacy giants to capture India’s evolving growth story [punjabkhabarnama].
Frequently Asked Questions
What prompted Chris Wood to exit Reliance Industries? ❓
The exit followed Reliance’s AGM, where concerns about Jio Platforms’ 2026 IPO and potential holding company discounts led Jefferies to reallocate capital to sector-focused opportunities.
Which Adani stocks are in Jefferies’ India portfolio? 🏗️
Ambuja Cements (4% weighting) and Adani Ports (6% weighting) are included, capitalizing on regulatory changes and industry consolidation.
How did the portfolio rebalancing affect other holdings? ⚖️
Jefferies exited Axis Bank, trimmed ICICI Bank, REC, and JSW Energy, and added Ixigo and Lemon Tree Hotels for diversified growth exposure.
Why is the GST cut significant for Ambuja Cements? 🛠️
The GST reduction from 28% to 18% boosts Ambuja’s profitability, driving institutional interest and analyst upgrades.
How might this shift influence India’s market strategy? 📊
It highlights a focus on agile, sector-specific firms, potentially encouraging investors to prioritize regulatory winners over traditional conglomerates.