India’s third-largest information technology (IT) company, HCLTech, is planning to invest $150 million in home-grown artificial intelligence startup Sarvam AI.
The investment will be part of the latest funding round to be raised by the Bengaluru-based startup, Moneycontrol reported.
Sarvam AI is organising a $300 million funding round at a valuation of $1.5 billion. This valuation is about seven times higher than its last funding round in 2023. The report said this could become the biggest funding round for an Indian AI company in recent years.
HCLTech will lead the funding round, while venture capital firm Bessemer Venture Partners (BVP) will also invest $50 million.
The remaining amount will be invested by Nvidia, Prosperity7, Activate, and Glade Brook, among others.
Khosla Ventures, Lightspeed, and Peak XV Partners are among the existing investors in Sarvam AI expected to participate in the funding round.
Sarvam AI has launched two large language models. One model is trained on 30 billion parameters, while the other is trained on 105 billion parameters.
Founded in 2023, Sarvam AI is among the leading beneficiaries of the government’s IndiaAI Mission worth Rs 10,000 crore.
Sarvam has so far secured a record 4,096 NVIDIA H100 SXM GPUs, receiving nearly Rs 99 crore in subsidies.
HCLTech’s likely investment in an AI company comes at a time when the technology is posing a threat to the traditional business models of IT companies.
The deal would mark a rare instance of an IT company backing an AI startup. Indian IT companies are facing a tough time as AI technology changes the nature of software development and back-office services.
Indian IT stocks have been under pressure due to a strong rally in AI-related stocks in other Asian markets.
Many Indian IT stocks have hit their 52-week lows amid criticism that they have been slow to adopt AI technology in their business models.