The brokerage is of the view that in a rising inflation environment, hard assets sectors like infrastructure assets, including roads, airports, ports, power utilities, hospitals, land banks (real estate developers, REITs) tend to benefit as they preserve the real value of investments.
Within this “hard assets” space, Jefferies has highlighted GMR Airports, Adani Ports, Max Health, Fortis Healthcare, Embassy REIT, Lodha Developers, Godrej Properties, Adani Power, Adani Energy Solutions and JSW Energy. These stocks comprise of 20% of Jefferies’ model portfolio.
What Are The Jefferies Model Portfolio Changes?
Jefferies has reduced its NBFC weightage in the model portfolio, by reducing its exposure to Cholamandalam Investment, due to its exposure to the Commercial Vehicle segment amidst the fuel price hikes.
Within the Automotive segment, the brokerage has replaced its investments in TVS Motor and Mahindra & Mahindra (M&M) due to fears of margin pressure and a weak rural segment outlook, with Eicher Motors, given the better pricing power due to its premium positioning.
Jefferies has added Adani Ports to the model portfolio by trimming its investment in Adani Energy Solutions. It has also replaced UltraTech Cement with Grasim on improving standalone business fundamentals, which will help narrow the holding company discount, currently between 35% to 40%.
It has also replaced Max Financial Services with Star Health, given its expectations of a 30% Earnings Per Share Compounded Annual Growth rate (CAGR) over financial year 2026-2029, and lower regulatory risks.
Finally, new listing Groww has been added to the model portfolio as Jefferies believes it is well placed to deliver an EPS CAGR of nearly 30% over financial year 2026-2029, driven by product expansion.
