Jefferies Favours Banks, Power, Metals as Indian Growth Accelerates

Investment bank Jefferies has outlined its sectoral strategy for Indian markets against the backdrop of accelerating nominal GDP growth expected to reach 12% in the fiscal year ending March 2027. The bank's analysis points to five sectors with enhanced potential to capitalise on India's economic momentum and structural growth drivers.

Financial services, particularly banking, remains a core conviction with Jefferies maintaining overweight positioning. The sector is seen as a primary beneficiary of credit expansion accompanying robust nominal GDP growth. The power sector also features prominently in the bank's recommendations, reflecting India's ongoing infrastructure development and rising energy demand. Metals and mining emerge as another favoured segment, supported by both domestic consumption growth and global commodity dynamics.

Real estate and hospital sectors complete Jefferies' list of preferred exposures. The property market is expected to benefit from rising incomes and urbanisation trends, while the healthcare sector presents structural growth opportunities driven by increasing healthcare spending and demographic shifts.

Jefferies' sector selection emphasises earnings quality and visibility, prioritising businesses with clearer near-term growth trajectories. This approach reflects broader market sentiment that Indian equities offer compelling opportunities as nominal GDP expansion gains momentum, though stock selection and sector allocation remain critical to portfolio performance. The bank's positioning suggests confidence in India's macroeconomic trajectory and cyclical recovery dynamics across these key growth engines.