The Securities and Exchange Board of India has decided to allow seven banned brokerages to start distributing initial public offers and follow-on public offers.
Sebi had acted against 10 brokerages after over 10,000 investors failed to get shares in last year's Coal India IPO in spite of legitimate applications.
The brokerages had blamed technical glitches for this.
Industry officials confirmed the Sebi move.
"With some IPOs being launched next week, this is a big relief for these brokerages," said a senior investment banker.
A number of big public issues, including Future Ventures' Rs. 750 crore IPO, Muthoot Finance's Rs. 800-1,000 crore issue and SAIL's Rs. 8,000-crore FPO, are expected to hit the market in a couple of months.
The three brokerages still under the ban are Edelweiss Securities, SMC Global Securities and J M Financial.
"Sebi has looked at what these brokerages have done to resolve investor complaints. The other three are likely to get the approval soon, perhaps this week itself," said a senior official of a brokerage.
Industry estimates that around 70