This document provides an overview and share summary of Royal Mail plc (RMG LN) as of August 13, 2020. It summarizes the latest shareholder disclosures, including Schroders plc decreasing its stake to 13.25% and VESA EQUITY INVESTMENT Sarl disclosing a 13.1% stake. It also provides an estimated valuation of Royal Mail over the next 3 years, projecting the share price could increase 102% to £4.43 per share, representing average annual upside of 34%.

1. Shareholder Insights
Royal Mail plc (RMG LN)
August 13, 2020
Overview
In 2019, Etalon started to provide research based on the analysis of hedge funds
and institutional shareholders. Combining our value/event-driven focus with in-
depth knowledge of many hedge funds active in the market we aim to combine
data analytics with human knowledge and input that is unavailable in data-only
products. This is especially true for identification of “outliers” and generation of
useful insights from them
Share Summary
Share Summary Aug 13, 2020
Market Price 2.20
Shares Out (mil) 1,000
Market Cap (mil) 2,200
Net Debt (1,132)
EV 3,332
* Excluding the impact of IFRS 16 adoption, net debt would be GBP 46 mil

2. Latest holding disclosures
6 August, 2020
Schroders plc disclosed a stake of 13.25% (decrease from previous 13.9%)
https://www.londonstockexchange.com/news-article/RMG/holding-s-in-company/14644915
4 August, 2020
Private equity firm VESA EQUITY INVESTMENT Sarl disclosed a stake of 13.1% in the
company
Investor disclosed an initial holding of 3.05% on March 12, 2020 and since then had
steadily increased the position to its current size
https://www.londonstockexchange.com/news-article/RMG/holding-s-in-company/14640655
https://www.londonstockexchange.com/news-article/RMG/holding-s-in-company/14459031
It is important to note that according to filings, investor more than doubled his
position during approximately a three months period between May 19th and July
30th
. During this period share price remained almost unchanged, so the average
cost for this second half of investor’s stake can be estimated to be about GBP 1.70
per share

3. Estimated Valuation - 3 years
Estimated valuation - 3 years
Net Debt -1,132
Cumulative FCF * 1,282
Restructuring initiatives savings (est) 500
EBITDA * 841
EV/EBITDA multiple 4.5
EV 3,785
Market Cap 4,435
Shares outstanding 1,000
Market Price 4.43
3-year potential upside 102%
Annual upside (est) 34%
* Valuation assumptions:
- EBITDA assumed to remain at the FY 2020 level
- Annual free cash flow at the 3-year FCF average (GBP 427 mil)
- Cumulative savings from restructuring initiatives of GBP 500 mil
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