Change in methodology from EV/EBITDA to PE as profitability improves: After taking a re-look at an improved leverage situation (a legacy issue for the company in the last five years) we have critically evaluated our earlier methodology of applying EV/EBITDA gauge for valuation. We believe it is the right time to change the same to PE gauge as the debt component in EV has come down substantially as reflected in Exhibit 2, besides waning debt stress and improved business mix (hence EBITDA margins). The situation is likely to improve further in FY16-19E. Accordingly, we arrive at our new target price of | 635 (from | 420 earlier) based on 10x FY19E EPS of | 63.5. We still value Jubilant at a substantial discount to peer pharma companies due to the blended business model (47% of revenues from commoditised LSI segment) besides a volatile past. However, we do not rule out a further re-rating in the stock.