Goldman Sachs Reveals 42 Indian AI Enabler Stocks That Surged 60% While Nifty Dropped 12% in 2026

Goldman Sachs Uncovers Hidden AI Infrastructure Winners in India

While India's Nifty index declined 12% in 2026, Goldman Sachs has identified a striking divergence beneath the surface1

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. The investment bank screened approximately 1,800 companies listed on Indian exchanges, representing a combined market value of around $5 trillion, and discovered 42 AI enabler stocks that surged about 60% during the same period2

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. This basket, with a combined market capitalization of $670 billion, has become the best-performing segment of the Indian market by a wide margin, challenging the prevailing narrative that India offers limited exposure to the global AI boom.

The 42 Indian AI enabler stocks were selected based on rigorous filters including market size, liquidity, revenue growth, capital expenditure intensity, research and development spending, and management commentary on AI infrastructure1

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. Goldman Sachs focused on companies with visible revenue generation, order book pipelines, capital commitments, and partnerships across the AI-related supply chain. The selection spans businesses involved in power generation, power transmission, power equipment, data centre development and operations, data centre hardware, semiconductor assembly and testing, semiconductor materials, and semiconductor hardware.

Power, Data Centres, and Semiconductors Lead the Rally

The rally has been remarkably broad-based across all three major layers of India AI infrastructure. Power generation, data centre operations, and semiconductor infrastructure have each gained between 40% and 80% in 2026, according to Goldman Sachs1

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. Six of the nine sub-layers have risen more than 20%, while all nine have outperformed the MSCI India index. This performance stands in sharp contrast to the next best-performing sector, healthcare, which gained only about 10% this year.

Data centre operators account for the largest share of the basket's total market value at approximately $400 billion, followed by power equipment companies at $100 billion, power generation at $50 billion, and power transmission at $45 billion1

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. The composition reveals that much of India's AI exposure sits outside traditional benchmark heavyweights. Of the 42 companies, 8 are microcaps, 13 are smallcaps, 9 are midcaps, and only 12 are largecaps. Capital goods account for half the basket with 21 companies, while utilities and technology hardware represent the other major areas of exposure.

Earnings Growth Drives Performance, Not Speculation

Goldman Sachs emphasized that the rally has been driven primarily by earnings growth rather than speculative multiple expansion2

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. Since 2025, the AI enabler stocks basket has returned 53%, with earnings growth contributing 65 percentage points while valuation compression reduced returns by 12 percentage points. This fundamental-driven performance contrasts sharply with the broader market, where the Nifty index faces earnings cuts while the AI enabler cohort entered a strong earnings upgrade cycle.

Consensus estimates cited by Goldman Sachs indicate that earnings for the AI enabler stocks could grow 53% in 2026, 39% in 2027, and 29% in 20281

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. This compares favorably with expected 2027 earnings growth of 16% for MSCI India and 23% for the MSCI India Small and Midcap Index. Power generation, data centre hardware, and power equipment are expected to lead the next phase with earnings growth of about 40% to 60%. Collectively, the AI enabler group could contribute around two percentage points to Nifty 500 profit growth in 2027 and 2028.

India's Anti-AI Perception Masks Infrastructure Opportunity

India has increasingly become the default "anti-AI" trade among major markets because its benchmark indexes have limited exposure to AI-related companies1

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. The Indian market's AI-exposed share of its index remains far below regional peers including Korea, Taiwan, China, and Japan2

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. However, this perception overlooks the significant corporate focus on AI infrastructure building out across power, data centres, and semiconductors.

The list of 42 companies includes prominent names such as Adani Green Energy, Tata Power, NTPC Green Energy, Power Grid, Reliance Industries, Bharti Airtel, and Larsen & Toubro, alongside specialized players like Netweb Technologies, Kaynes Technology, and Himadri Speciality Chemical1

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. The earnings outlook is being supported by a strong investment cycle, with Nifty 500 capex growth expected to more than double to 16% in 2026 from 7% previously.

Goldman Sachs noted that while absolute multiples for AI enabler stocks trade at a premium to the broader market, when adjusted for their growth profile, they trade slightly below the broader MSCI India index2

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. This suggests potential value remains despite the strong rally, particularly as the infrastructure build-out required to support AI continues to accelerate across India's economy.