HCL Technologies Ltd. has made a strategic bet on India’s artificial intelligence ecosystem by investing Rs 1,427.25 crore in Sarvam AI, a Bengaluru-based startup building indigenous large language models and AI platforms.
The investment gives HCLTech a 10.46 percent stake in the company and forms part of Sarvam’s $300 million Series B funding round, which values the startup at $1.5 billion post-money.
Shares of HCLTech were trading at Rs 1,155, up around 4 percent from the previous close of Rs 1,119.30. The company has a market capitalization of Rs 3,13,320 crore and trades at a price-to-earnings multiple of around 18 times.
HCLTech emerges as lead investor
The first close of Sarvam’s funding round raised $234 million.
HCLTech committed $150 million as the lead strategic investor, alongside:
- Bessemer Venture Partners
- Khosla Ventures
- Peak XV Partners
The investment will fetch HCLTech 41,421 equity shares in Sarvam.
According to the company, the transaction is expected to be completed within two weeks and does not involve any related-party interests.
Why HCLTech is investing
The move is aimed at strengthening HCLTech’s AI capabilities and giving it early access to Sarvam’s models.
The partnership is expected to help the company:
- Build industry-specific AI solutions.
- Reduce dependence on foreign AI platforms.
- Develop multilingual AI applications.
- Target sovereign AI opportunities.
HCLTech sees growing demand from governments and regulated industries where concerns around data security and localisation are increasing.
Focus on banking, insurance and government sectors
The partnership could help HCLTech offer AI solutions to sectors where data sensitivity is critical.
These include:
- Banking
- Insurance
- Government technology
- Defence
The company also expects to benefit from Sarvam’s ability to support Indian languages and local use cases.
What does Sarvam AI do?
Sarvam AI develops foundation models trained specifically for Indian languages and contexts.
Its platform covers:
- Text
- Speech
- Vision
- Document processing
Among its models are:
- Sarvam 105B, designed for complex enterprise applications.
- Sarvam 30B, aimed at conversational AI deployments.
- Sarvam-1, a lightweight model with two billion parameters.
The company’s vision technology has already processed more than 35 million pages of insurance forms and land records.
Its speech models transcribe over 500,000 hours of audio every month.
Sarvam’s customers include:
- SBI Life
- LIC
- IDFC
- Tata Capital
- CRED
FY26 performance
HCLTech reported revenue of Rs 1,30,144 crore in FY26, an increase of 11.2 percent year-on-year.
FY26 highlights
- Revenue: Rs 1,30,144 crore
- EBIT: Rs 22,397 crore
- EBIT margin: 17.2 percent
- Net income: Rs 17,361 crore
- Diluted EPS: Rs 64.01
- Total contract value bookings: $9.32 billion
- Constant currency revenue growth: 3.9 percent
Q4 FY26 performance
For the March quarter, the company reported:
- Revenue of Rs 33,981 crore, up 12.3 percent year-on-year.
- Net income of Rs 4,488 crore.
- EBIT of Rs 5,620 crore.
- EBIT margin of 16.5 percent.
- Quarterly TCV bookings of $1.94 billion.
Revenue from Advanced AI offerings increased to $155 million during the quarter.
TL;DR:
HCLTech is investing Rs 1,427 crore in Bengaluru-based Sarvam AI to gain early access to indigenous language models and strengthen its enterprise AI capabilities. The deal gives HCLTech a 10.46% stake in the startup and supports its push into sovereign AI solutions.
AI Summary:
- HCLTech is investing Rs 1,427 crore in Sarvam AI.
- The company will own a 10.46% stake in the startup.
- Sarvam develops AI models tailored to Indian languages and use cases.
- The partnership targets banking, insurance, government and defence sectors.
- HCLTech reported FY26 revenue of Rs 1.3 lakh crore.
