Modi and his Bharatiya Janata Party stormed to power nearly three months ago on promises of reviving Asia's third-largest economy, but critics say the new premier has so far failed to unveil any sweeping reforms.
Forty-six percent of the respondents in a poll of 50 chief executive officers conducted by a business newspaper said they were watching for improved economic conditions before making planned investments that would help revive growth.
About one-third of the CEOs said they have already decided to increase investments, while 12 percent said they are not sure yet or do not have immediate plans to step up investments.
"The difference yet to be travelled by the government between intention and action manifests itself here," the newspaper said about the findings of the survey.
On the question of how much the economic situation has changed on the ground, the poll showed only four CEOs gave Modi a rating above six on a scale of 1 to 10, with 10 being the highest.
Though some signs of recovery have emerged, high interest rates and inflation continue to weigh on the Indian economy, as it wades through its longest phase of sub-par growth in decades.
According to a Reuters poll released on Tuesday, the economy likely grew at its fastest pace in two years between April and June. The GDP data is due on Friday.
The executives also said the economy will rebound going forward, with 72 percent of those polled predicting annual economic growth of between 6-8 percent in the next three years.
Almost three-quarters of the CEOs said the new government was meeting their expectations, with 18 percent saying Modi was performing better than the "most optimistic of expectations".
High hopes that Modi will deliver on his promises also boosted foreign inflows in Indian shares this year. The benchmark BSE index hit a life high of 26,674 on Thursday, heading for its seventh consecutive monthly gain.
The stock market is seen rising further, the Economic Times survey showed, with more than half of the CEOs seeing the BSE index between 27,000 and 35,000 by December 2015.
A public opinion poll released last week by India Today-Hansa Research showed more than 70 percent of Indians were satisfied with Modi's leadership since he took office in May.