We have assumed that you follow the Hindu religion and are governed by the Hindu Succession Act, 1956. If the ancestral property was inherited by your father from his father, father’s father or father’s father’s father and the succession opened prior to 1956 (that is, if the succession to this property to your father or your father’s father or your father’s father’s father, through a paternal line of succession, took place before 1956, this property would be Hindu Undivided Family/coparcenary property), the property will be ancestral coparcenary and your sons as coparceners would have a right in the property as coparceners (see: Surendra Kumar versus Dhani Ram & Ors. [AIR 2016 Delhi 120] and Arshnoor Singh versus Harpal Kaur and Ors. [Civil Appeal No. 5124 of 2019]).
Your wife’s daughter from her first marriage won’t have a right in the property. However, if the succession to such ancestral property opened after 1956, the said property is self-acquired in your hands and does not remain coparcenary in view of Section 8 of the Hindu Succession Act (see: Yuidhister versus Ashok Kumar [(1987) 1 SCC 204]) and you may dispose it of to any person (including your two sons, your wife and/or step-daughter) through your Will, as you may deem fit at your sole discretion.
The flat, shares and mutual fund units, which you have mentioned, appear to be self-acquired. Accordingly, you may dispose them of to any person through your Will. According to Section 30 of the Hindu Succession Act, any Hindu can dispose of, by Will or other testamentary disposition, any property, which is capable of being so disposed of by him or her, in accordance with the Indian Succession Act, 1925, or any other law for the time being in force and applicable to Hindus. If you do not execute a Will, then your sons along with your second wife will acquire a share in your property on your death as “Class 1 heirs” under the provisions of Section 8 of the Hindu Succession Act, 1956. Your “step daughter” will not have any right in your property since under the Hindu Succession Act 1956, a “stepdaughter” does not fall within the purview of a “daughter” and, therefore, has no legal right to your property, unless you specifically bequeath a share to her under your Will.