HCLTech Plans $150 Million Investment in Sarvam AI at $1.5 Billion Valuation

HCLTech, a leading Indian IT company, is set to lead a major funding round for Sarvam AI. According to a Moneycontrol report, HCLTech may invest $150 million in Sarvam AI at a $1.5 billion valuation. This move comes as Indian IT firms face rapid changes driven by artificial intelligence.

Key Highlights

• HCLTech may invest $150 million in Sarvam AI at a $1.5 billion valuation.
• Sarvam AI last raised $41 million in December 2023 and now targets a much larger round.
• Nvidia is rumored to join the funding round, bringing total expected investment to $300 million.
• Sarvam AI focuses on Indic-language AI and has developed large language models in India.

HCLTech's Investment in Sarvam AI

The upcoming funding round will be Sarvam AI's first in over two years. Sarvam last raised $41 million in a Series A round in December 2023. The new round is expected to bring in another $150 million from other investors, with Nvidia also rumored to participate.

If the funding is finalized, it will be one of the largest investments in an Indian AI startup. The deal marks a significant shift, as a traditional Indian IT company invests heavily in a homegrown AI firm. This move follows criticism that Indian service companies have not invested enough in artificial intelligence.

Context: Indian IT Sector and AI

Indian IT firms such as TCS, Infosys, and Wipro have approached AI cautiously. The sector has faced uncertainty as AI-native companies like Anthropic and OpenAI introduce new tools. These developments have raised concerns about the future of software-as-a-service (SaaS) in India.

HCLTech already has a partnership with OpenAI to implement AI tools for its clients. Other major Indian IT firms, including TCS and Infosys, have similar deals. However, the sector has faced criticism for lagging behind global AI leaders. Anthropic, founded in 2021, now has a valuation higher than the top four Indian IT firms combined.

Sarvam AI's Focus and Achievements

Sarvam AI was founded in July 2023 by Vivek Raghavan and Pratyush Kumar. The Bengaluru-based startup aims to build foundational AI models tailored for India. Sarvam focuses on Indic-language AI and voice-based applications for Indian users and enterprises.

At the IndiaAI Impact Summit earlier this year, Sarvam unveiled two open-weight large language models. These models, with 30-billion and 105-billion parameters, were trained from scratch in India. Sarvam's Vision and Bulbul models have outperformed ChatGPT and Google Gemini in specific tasks.

The company also showcased AI-powered smart glasses and the Sarvam Indus mobile app at the event. These products highlight Sarvam's commitment to developing AI solutions for Indian users.