Move aimed at boosting retail investor participation in disinvestment.
Stocks such as NIIT, Punj Lloyd, Gati, Welspun India and BEML are favourites of the trading community.
According to technical analysts, the Nifty could trade in the range between 7,400 and 7,700.
Bluechips underperform in recent rally.
Though India has been one of the best-performing markets in the last two months, it has lagged some of its emerging market peers such as the Philippines, Thailand and South Africa.
Of the 280-odd equity schemes that have been in existence for five years or more, 190 funds or about 70 per cent of those funds have outperformed their respective benchmark indices.
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Firms with low promoter holding may get to buy shares from secondary market.
The return of investor confidence in the equity markets is bringing some of the large companies back to the fund-raising table.
Equity markets are currently difficult to gauge as the market has probably priced in a lot of things ahead of actual events.
Having successfully implemented the 25 per cent free-float norm for private companies, the Securities and Exchange Board of India now wants the government to pare its holdings in public-sector undertakings to below 75 per cent.
Instead of being carried away by Friday's historic election verdict, savvy investors were seen taking money off the table, after the benchmark Sensex rallied about 1,500 points in intra-day trade.
Sensex gains 2.4%, Nifty crosses 7,000; investors feel exit polls have vindicated their stand
Besides foreign flows, corporate earnings and US Federal Reserve chief Janet Yellen's testimony to the nation's legislature are also likely to impact investor sentiment.
Current FDI norms allow a foreign airline to hold up to 49 per cent in a domestic carrier.
Could address the concerns over Companies Act provision on the issue
Any change in rates would mean more volatility; else, poll outcome-fuelled rally expected to continue.
Of the 70 international feeder funds, more than half have made losses in 2014.
Gripped by the pre-election frenzy, Indian markets seem to be factoring in the victory by the Narendra Modi-led BJP.
Institutional investors - both foreign and domestic - lapped up the government's big-ticket share sales on Friday, helping it add nearly Rs 9,000 crore to its revenue kitty.
Analysts said FIIs had created long positions worth Rs 9,700 crore (Rs 97 billion) in index futures till recently.
