The proposal to merge sub-limits of foreign portfolio investments (FPI) with FDI augurs well for lenders like Axis Bank, HDFC Bank, Yes Bank Kotak Mahindra Bank and IndusInd Bank. The proposed measure will provide additional room for inflow of foreign investments into these stocks where FII holding is nearing limit.Analysts believe dilution of sub-limit for foreign investors will increase free float available for FIIs, hence more weightage of India in the MSCI Emerging Market (EM) index. India's weight in the MSCI EM index now stands at 8.1%.

Source - http://economictimes.indiatimes.com