JM Financial Limited has announced the allotment of 28,200 equity shares to eligible employees under its Employee Stock Option Scheme (ESOP) Series 16. The Allotment Committee of the Board approved this allotment at its meeting held on February 5, 2026.

Share Allotment Details

The allotted shares carry a face value of ₹1 each and were issued pursuant to the exercise of stock options by eligible employees under the company's established ESOP framework.

Impact on Share Capital

Following the allotment of these equity shares, JM Financial Limited's paid-up equity share capital has been revised upward. The company's total paid-up equity share capital now stands at ₹95,63,64,073, representing 95,63,64,073 equity shares of face value ₹1 each.

Regulatory Compliance

The company has informed both BSE Limited and the National Stock Exchange of India Limited about this allotment through formal communication. The notification was signed by Hemant Pandya, Company Secretary & Compliance Officer, ensuring proper regulatory disclosure and record-keeping requirements are met.

This ESOP allotment reflects the company's commitment to employee participation in its growth through equity ownership, providing eligible employees with a stake in the organization's performance and future prospects.

With the Union Budget 2026-27 just weeks away and Brent crude hovering near $60 per barrel, JM Financial is urging investors to pick their oil and gas bets carefully. The brokerage has issued contrasting recommendations across the sector, backing upstream producers while warning of fiscal risks for downstream companies.

Upstream Producers Offer Medium-Term Value

JM Financial has reiterated buy ratings on both Oil India and ONGC, citing attractive valuations that already factor in weaker near-term crude realizations. The brokerage sees significant value in upstream stocks at current price levels.

For Oil India, JM Financial expects a compelling growth story driven by 20-25% cumulative oil and gas production growth and the expansion of the Numaligarh refinery from 3mmtpa to 9mmtpa. The brokerage describes it as a "15% earnings-compounding story over the next 2-3 years." ONGC is also expected to benefit from medium-term production growth, despite lower near-term Brent assumptions of $65 per barrel for FY26 and FY27.

Excise Duty Risk Looms for Marketing Companies

While subdued crude prices continue to support near-term marketing margins for oil marketing companies (OMCs), JM Financial cautions that the government could use the upcoming Budget to claw back revenue gains through higher excise duties on petrol and diesel.

The brokerage's analysis reveals significant scope for excise duty increases:

Mixed Outlook for Individual OMCs

JM Financial maintains cautious stances on the three major oil marketing companies, citing valuation concerns and policy risks:

HPCL faces particular challenges with its ₹730 billion Rajasthan refinery project, which may deliver only single-digit returns due to time and cost overruns. Despite strong near-term earnings prospects, IOCL and BPCL face stretched valuations and aggressive capital expenditure plans.

Near-Term Earnings Remain Robust

For the third quarter of FY26, JM Financial projects solid EBITDA growth across the OMCs, driven by strong diesel cracks and partial recovery in gross refining margins:

However, integrated margins are likely to moderate slightly, reflecting crude inventory losses and softer auto-fuel marketing margins.

Global Oversupply Pressures Persist

JM Financial points to persistent oversupply in global oil markets as a key factor keeping Brent prices subdued. The International Energy Agency expects a global oil surplus of approximately 2.30 million barrels per day in 2025, rising to nearly 3.80 million barrels per day in 2026. This oversupply is driven by OPEC+ output increases and non-OPEC supply growth, with potential easing of sanctions on Russia amid a peace deal with Ukraine potentially adding further pressure.

Against this backdrop, JM Financial's analysis suggests that upstream producers like Oil India and ONGC offer more reliable medium-term growth prospects compared to downstream marketing and refining companies, which face both valuation and policy headwinds as the government may tap into windfall gains from lower crude prices through the upcoming Budget.