HDFC Bank Out, HSBC In: Jefferies' Chris Wood Trims India and Australia to Fund Taiwan Pivot
In his latest "GREED & Fear" report, Christopher Wood of Jefferies has executed a major tactical shift by exiting HDFC Bank in favor of a 4% stake in HSBC. To fund a massive 4 percentage point increase in Taiwan, Wood has trimmed India’s overall allocation by 2%, bringing it closer to a neutral benchmark level.
Christopher Wood has officially removed HDFC Bank from his high-profile long-only portfolios, including the Asia ex-Japan, Global, and International (ex-USA) mandates. In his latest note, Wood confirmed that the capital recovered from the exit would be used to establish a new position in a global peer. “An investment in HSBC will also be introduced with a 4% weighting by removing the investment in HDFC Bank,” Wood wrote. This signals a preference for a banking giant with exposure to North Asian markets, which are currently benefiting from resilient trade flows and a weaker yen.
While Wood did not explicitly detail the internal reasons for the exit, the timing coincides with the shock resignation of HDFC Bank’s Part-Time Chairman Atanu Chakraborty. Chakraborty’s departure has left the market on edge after he cited “certain happenings and practices within the bank” that he claimed were “not in congruence” with his personal values and ethics. This specific phrase triggered an 8.7% slide in HDFC Bank shares in a single session, wiping out approximately $16.3 billion in market value over just three days. Wood’s move to "play it safe" reflects a wider concern that the bank's "governance premium" has been damaged.
Funding the North Asian Technology Pivot
Wood has adjusted his Asia Pacific ex-Japan relative-return portfolio to capitalize on the global artificial intelligence boom. “The weighting in Australia and India will be reduced by two percentage points each, while the weighting in Taiwan will be increased by four percentage points to a smaller underweight,” the report noted. This 4% boost to Taiwan is driven by the island’s tech-heavy index being “buoyed by hyperscaler-driven capex,” as U.S. technology giants significantly ramp up infrastructure spending to support AI development.
The reduction in India’s allocation brings its total weightage in Jefferies' Asia Pacific strategy to 13%, which is now just 50 basis points (0.5%) above the MSCI AC Asia Pacific ex-Japan benchmark. Wood, traditionally a long-time India bull, warned of a "macro sting in the tail" as the Iran war creates a “vicious cycle” of capital flight. This is exacerbated by a record-low rupee (94.29) and $100-plus crude oil, which has contributed to Foreign Institutional Investors (FIIs) pulling a massive $12.14 billion out of the Indian market in March 2026 alone.
Published By : Shourya Jha
Published On: 27 March 2026 at 13:42 IST