Price, Potential & Positioning

We focus on identifying sectors propelled by multi-year structural tailwinds. Rather than chasing short-term cyclical trends, we focus on industries experiencing foundational, decadal shifts—such as the ongoing renaissance in domestic manufacturing in India, advancements in precision engineering, and the evolution of our energy infrastructure as the world transitions to green energy. Within these expansive runways, we seek out businesses with sustainable moats and global competitiveness. By actively applying Michael Porter's Five Forces model for top-down industry analysis, we identify ecosystems that actively resist margin-destructive involution, ensuring growth remains value-accretive.

A detailed value chain analysis helps us focus on strategic positioning within a sector. We specifically target the critical component manufacturers, capital goods suppliers, and under-the-radar companies providing essential inputs, services, and technologies. Essentially, we are ‘nuts and bolts’ investors focused on the unglamorous ‘picks and shovels’ businesses that profit from a structural tailwind regardless of which end-consumer brand wins the market.

Pegasus' proprietary CEGARP framework is a stock selection and valuation model that prioritizes strong cash flows, high capital efficiency, and management teams capable of generating returns significantly above their Weighted Average Cost of Capital. The model utilizes fixed income yields, sustainable Return on Invested Capital, cash flow, and medium-term growth forecasts as key variables to determine the valuation band for an asset. It is flexible to every part of the economic and monetary cycle, successfully fulfilling the dual objective of capital preservation and consistent appreciation.