Highlights – It is not through AI, but in the name of AI that these Indian companies have made investors wealthy, with shares surging by up to 500%.
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There is massive investment happening globally regarding Artificial Intelligence (AI). However, the Indian stock market does not have major AI companies that can directly benefit from this trend like those in the US, Taiwan, or South Korea. But, Indian companies that are building the necessary infrastructure for AI have emerged as the big winners of this era.
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Sterlite Technologies has been the most discussed this year. The share price of this optical fiber manufacturing company has risen by more than 530 percent. Recently, the company received a multi-year order worth $1.1 billion from a major US tech company. Similarly, HFCL’s shares have risen by 191 percent, and the share price of MTAR Technologies, which makes cooling and power systems for data centers, has more than tripled.
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According to Bloomberg data, the combined market value of 28 Indian companies associated with the data center ecosystem has increased by about $47 billion this year. These companies include those manufacturing transformers, switchgear, wires, cables, and cooling systems. In contrast, the market value of the NSE Nifty 500 index, which represents the broader market, has fallen by more than $300 billion in 2026.
Not AI, but AI Infrastructure has become the new source of income
Every activity related to AI depends on large data centers. These data centers require huge amounts of electricity and cooling systems. For this reason, traditional industrial companies have now become a favorite among investors. In the market, this is being called the “AI Capex Trade.”
R. Sivakumar, Chief Investment Officer at Axis Mutual Fund, says that even though India may be lagging in the AI software race, Indian companies can benefit from the investments being made in AI infrastructure. He believes that opportunities exist in the data center and its entire associated supply chain.
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Data center investment is increasing in India
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Amazon has planned to invest $12.7 billion in cloud infrastructure in India by 2030. Meanwhile, Alphabet, the parent company of Google, is working on an AI infrastructure hub worth about $15 billion in Visakhapatnam. Apart from this, a joint venture of Reliance Industries signed an agreement for a $11 billion data center project last year. AdaniConneX has also partnered with companies like Google and Uber for data center construction.
Foreign investors’ interest has also increased
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Brokerage firm Nomura says that the demand for equipment to build, power, and cool data centers is increasing rapidly. There is a wait time of two to four years for many products, leading to large order books for companies. Because of this, foreign investors are also increasing their stakes in these companies. By March 2026, the share of foreign funds in industrial companies had risen to 14 percent, the highest level in the last two years.
The real earnings from AI
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While India lacks major AI-based tech companies, companies like Hitachi Energy India, ABB India, Cummins India, Finolex Cables, and Sterlite are benefiting from the growing demand for AI infrastructure.
According to Angel One, investors are now preferring not just the AI theme, but companies whose earnings are directly linked to AI infrastructure investment. However, the brokerage has also warned that valuations have become quite expensive after the sharp rise in many stocks, and any kind of disappointment could lead to losses for investors.
The world’s largest industrial investment cycle
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Analysts at Nomura believe that the investment in data centers has currently become the world’s largest industrial investment cycle. They say its scale could be larger than the 4G network expansion, the post-2008 LNG infrastructure construction, and the US shale oil boom.
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Experts believe that the AI revolution will not only benefit software companies but also those providing the necessary equipment and services to build and operate data centers. In India, currently, these companies have emerged as the biggest beneficiaries of the AI boom.
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Analysis:
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The provided news highlights a significant shift in the Indian market where the “AI boom” is being monetized not by software developers, but by the physical “plumbing” of the digital age—the data center infrastructure. The article underlines that while India may lack indigenous “pure-play” AI software giants, the massive capital expenditure (Capex) allocated by global tech titans like Amazon and Google toward physical hubs in India is driving unprecedented growth for traditional industrial manufacturers in the power, cooling, and cable sectors. This “AI Capex Trade” represents a tangible, long-term industrial cycle rather than a speculative software bubble, though investors are cautioned that the current high valuations may carry risks of correction.
