Foreign Investors Resume Buying Indian Tech Stocks Amid AI-Driven Growth Outlook

Foreign portfolio investors have reversed course, increasing their net purchases of Indian technology stocks in January 2026, driven by optimism around artificial intelligence adoption and digital transformation. The surge marks a significant shift after months of capital outflows.

Foreign investors injected $1.8 billion into Indian equities in January 2026, with technology stocks accounting for over 60% of the inflow—amounting to $1.08 billion. This marks the first sustained positive flow into Indian tech since late 2024, signaling renewed confidence in the sector's long-term trajectory. The rebound is largely attributed to growing visibility into artificial intelligence applications across sectors such as fintech, healthcare, and enterprise software. Companies like Tata Consultancy Services (TCS), Infosys, and Wipro have announced new AI-focused product launches and strategic partnerships with global firms, boosting investor sentiment. TCS reported a 24% year-on-year increase in revenue from its AI and analytics services during Q3 FY2026, while Infosys saw a 31% rise in demand for generative AI solutions. Market indices reflect the shift: the Nifty IT Index rose 15% in January alone, outperforming the broader Nifty 50, which gained 7%. Foreign ownership in the top 10 Indian tech firms now stands at 19.8%, up from 17.4% in December 2025. This level of foreign participation is approaching pre-pandemic highs. The influx has also prompted domestic institutions to reevaluate allocation strategies. Mutual funds increased their exposure to mid-cap tech firms by 12% in January, citing improved earnings visibility and AI-driven margins.