Ann: Investor presentation - IOOF FY 2018 results, page-25

Thank you, @Just_a_guy

In their previous report from May 2018, BP used a Sum-Of-Parts valuation approach, attaching some rather arbitrary PE multiples to their expected FY18 IOOF sector UNPATs.

For illustration purposes, the multiples used in that report were:

Platforms and administration: 12.0x
Advice and distribution: 10.0x
Investment Management: 14.0x
Trustees: 14.0x
Corporate expenses: 10.0x

Adding Net Cash, they then got to a 7.75$/share SOP valuation. As their revised price target is now 7.61$, they must have made their multiples even more conservative since.

So, in essence, it would appear that they are 1) ignoring the future contribution from ANZWM almost entirely, with a FY2021 cash EPS forecast of just 66.6cps (corresponding to a 5.1% annual EPS CAGR over the next three years), and 2) applying steeply below-market multiples to their already meagre EPS assumptions.

They did quote (in the May report) the likely adoption of the 3% fee caps as being one of the driving factors behind their choice of PE multiples, but I cannot see any further fundamental justification being provided.

So, there you go, diversity is what makes a market after all.