In a major push towards India’s growing artificial intelligence ecosystem, HCL Technologies on Monday announced an investment of Rs 1,427.25 crore (approximately $150 million) in Bengaluru-based AI startup Sarvam AI, acquiring a 10.46% minority stake in the company.

The all-cash deal values Sarvam AI at $1.5 billion and marks one of the largest strategic investments by an Indian technology services company into the country’s fast-emerging sovereign AI sector.

HCLTech leads Sarvam AI’s $300 million funding round

Sarvam AI, widely positioned as India’s full-stack sovereign AI startup, announced the first close of its Series B funding round at $234 million out of a planned $300 million raise. The round was led by HCLTech, with participation from global investors including Bessemer Venture Partners, Khosla Ventures and Peak XV Partners, all of whom are existing backers of the AI company.

As part of the transaction, HCLTech will acquire 41,421 equity shares in Sarvam AI. The deal is expected to be completed within two weeks of signing.

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Investment aimed at building next-generation AI models

According to HCLTech, the fresh capital infusion will support Sarvam AI’s research and development efforts focused on training next-generation frontier AI models.

The company said the funding will specifically help accelerate development in agentic AI systems, coding models and cybersecurity-focused artificial intelligence applications.

In a press release, HCLTech said the investment would also provide Sarvam AI access to large-scale computing infrastructure required to expand deployments across critical industry verticals.

Big push for India’s sovereign AI ambitions

The partnership is being viewed as a significant step in India’s ambition to develop sovereign AI capabilities amid growing concerns over dependence on foreign artificial intelligence infrastructure.

HCLTech said its deep expertise in enterprise transformation and extensive global client network will help accelerate Sarvam AI’s long-term vision of building an end-to-end sovereign AI ecosystem not just for India but for global markets as well.

The company added that the collaboration will allow it to develop industry-specific language models and customised AI solutions for its international client base while improving price-to-performance outcomes for enterprise AI adoption.

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Sarvam AI focusing on enterprise, government and defence sectors

Founded in July 2023, Sarvam AI has rapidly emerged as one of India’s most closely watched AI startups. The company is building frontier AI models across multiple formats including language, speech, vision and document intelligence systems, all trained from scratch in India.

Its major focus sectors include banking, insurance, government technology and defence applications, areas increasingly prioritising localised and secure AI deployment.

Currently, Sarvam AI’s offerings include training and inference infrastructure, SaaS-based AI platforms, services-as-software models, smart devices and wearable AI solutions.

Revenue growth shows rapid expansion

Sarvam AI has reported sharp business growth over the last two financial years. The company posted an unaudited turnover of Rs 45.10 crore in FY2026, a significant jump compared to Rs 1.50 crore in FY2025, while it had reported no revenue in FY2024.

The startup has also built partnerships with major Indian enterprises including SBI Life Insurance, Life Insurance Corporation of India, IDFC First Bank, Tata Capital and CRED.

HCLTech eyes enterprise AI opportunities globally

HCLTech said the strategic investment would strengthen its own AI capabilities by enabling development of multilingual AI models beyond India and accelerating deployment of sovereign AI systems for governments and heavily regulated industries.

The company added that sectors requiring secure and localised AI infrastructure are likely to drive significant future demand.

HCLTech also clarified that the transaction does not fall under related party transactions and does not require any separate government or regulatory approvals.

The investment comes at a time when Indian technology companies are increasingly looking to reduce reliance on foreign AI ecosystems and build indigenous alternatives as global competition around artificial intelligence intensifies.