Looking at the details of the P&L, I think it is fair to say...

Looking at the details of the P&L, I think it is fair to say that, even before the net positive contribution from ANZWM (ADG + Note Coupon), the underlying business has held up remarkably well.

I see this as being best illustrated by slide 17 in today’s Investor Presentation (see picture below):



In particular, if one focuses only on Gross Margin + Other Revenue - Operating Expenditure vis-a-vis pcp (circled in red above), i.e. before ANZWM and before non-cash items, there was virtually no deterioration at all.

This is despite 1) the negative impact of product repricing (which is reflected in the lower Net Operating Margin) and 2) a net negative impact from markets, as shown in slide 19 under the Investment Returns / Other line (see picture below):



Overall, and in light of a) the vertical integration model not being abolished, and b) the ANZ P&I acquisition seemingly on track to be completed, I would expect this business to gradually re-rate to a PE multiple more in line (or less out of synch) with the broader market.

Depending on the forward earnings assumptions made, I personally see an (initial) upside of ~30% from current levels as being entirely reasonable.