Foreign institutional investors increased holdings in three prominent Indian AI-focused companies during the March 2026 quarter, signaling renewed confidence in the sector's growth trajectory. These moves come as AI drives transformations across healthcare, finance, retail, manufacturing, cybersecurity, and automobiles, with Indian firms poised to capitalize on domestic digital initiatives and enterprise automation. Investors eye these stocks for their potential to enhance productivity and profitability through long-term digitalization trends.
Tech Mahindra Draws Selective FII Return
Tech Mahindra, a key player in IT services under the Mahindra Group, saw FII ownership rise to 18.59% in March 2026 after dipping to 17.94% in December 2025 from 20.60% in September. The company delivers AI, cloud computing, cybersecurity, telecom, and digital transformation services to clients in banking, healthcare, manufacturing, and communications across more than 90 countries.
Management highlighted scaling AI-led offerings, with investments embedding AI into services and hiring specialists for innovation. Engagements with large clients in data and AI initiatives point to broader enterprise transformations. FY26 brought gains in client metrics: US$50 million-plus clients grew 4 year-on-year to 29, while US$20 million-plus clients rose 7 to 66, reflecting deeper relationships in AI, data, and consulting.
Financials for FY26 showed revenues at US$6,385 million, up 1.9% year-on-year and 0.6% on a constant currency basis. Operating profit reached US$797 million, a 31.4% increase, with margins expanding 290 basis points to 12.6%.
Tata Elxsi Rebounds on AI Advancements
Tata Elxsi, a global leader in design and technology services for automotive, broadcast, communications, healthcare, and transportation, experienced FII holdings climb to 11.08% in March 2026 following a drop to 8.57% in December from 12.53% in September. The firm applies digital technologies like IoT, cloud, mobility, virtual reality, and AI to help customers redesign products and services.
In FY26, Tata Elxsi accelerated GenAI adoption through partnerships, its DevStudio.ai automotive platform launch, tool stacks, infrastructure investments, and employee upskilling. These steps position the company as an AI-native engineering organization, emphasizing design-led, AI-enabled offerings for growth and margins.
The FII rebound indicates restored faith after earlier caution tied to valuations or growth worries.
LTM Builds Steady FII Interest
LTM, rebranded from LTIMindtree in 2026 and backed by Larsen & Toubro, provides cloud computing, AI, cybersecurity, digital engineering, analytics, and enterprise applications. FII stakes edged up gradually to 6.63% in March 2026 from 6.51% in December and 6.40% in September.
The company launched BlueVerse, an agentic AI ecosystem, to speed clients' concept-to-value processes and build AI-centric capabilities. Q4 FY26 order inflows held at US$1.7 billion, the sixth straight quarter above US$1.5 billion. Major wins include an enterprise-wide AI deal with a US financial institution and a partnership with a US software provider for AI-driven transformations.
LTM's approach rests on AI foundations, future-ready talent, reimagined delivery, and productivity gains, supporting a strong FY27 pipeline.
