In the latest edition of ETMarkets Smart Talk, an interview series from The Economic Times' markets desk, Anil Rego, Managing Director and Chief Investment Officer at Right Horizons PMS, said he believes the worst of the valuation-led correction may be behind the market, and that a broadening earnings recovery could provide the catalyst for the next leg of the market.

Right Horizons PMS is an Indian portfolio management services firm headquartered in Bengaluru, which Rego founded and where he leads investment strategy. In India, portfolio management services are regulated by the Securities and Exchange Board of India (SEBI) and require a minimum investment of ₹50 lakh per client, a threshold that keeps the segment aimed largely at high-net-worth investors.

The valuation-led correction Rego references saw Indian benchmark indices such as the Nifty 50 fall more than 10% from their 2024 record highs, a drawdown that coincided with a slowdown in corporate earnings growth during the 2024-25 financial year and with commentary that share prices had run well ahead of profits. Whether earnings growth broadens back out across sectors has since become a central question in Indian market discussion, and that transition — from a market correcting for valuations to one driven by earnings delivery — is the shift his earnings-led phase framing points to.

In the interview, Rego's favored sectors are financials, autos and industrials, as set out in the discussion of where he sees opportunities in the current phase of the market. Financial services is the largest sector weight in the benchmark Nifty 50, while autos and industrials are among the most commonly cited proxies for Indian consumer demand and capital spending.

The full interview is published on The Economic Times website: ETMarkets Smart Talk | India enters earnings-led phase; Anil Rego favours financials, autos, industrials