30 May 2020 JLS has gradually improved margins for three years now, led by superior execution in the Specialty business in both the Pharma as well as Life Science Ingredient (LSI) segments. The overall Specialty business forms 51% of the total revenue. Particularly, the Specialty business in the Pharma segment recorded a 22% CAGR over FY1820, led by better traction as well as inorganic growth. We reduce our EPS estimate by 2% for FY21 to factor COVID-19-led slowdown, particularly in the Life Science Chemical and API segments. We continue valuing JLS on an SOTP basis to arrive at a price target of INR515 and maintain Buy on the stock. Revenues were flat YoY at INR23.9b (in-line). The Pharma segment (INR14.8b; 63% of sales) grew at 6% YoY. The LSI segment saw decline of 11% YoY at IN8b (34% of sales), which hampered overall growth. The gross margin improved 570bp YoY to 64.9% on a superior product mix.