Metal & commodity-linked spaces to benefit from AI capex: Bajaj Finserv AMC
With AI growth relying as much on physical infrastructure as on software, the asset management company suggests investors capture that opportunity.
“Global capex in artificial intelligence (AI) infrastructure is estimated to reach $1 trillion by financial year 2030. To capture the opportunity, we increase exposure to metals and commodity-linked sectors, while remaining underweight in IT,” it said.
Bajaj Finserv believes that AI is on track to become the fastest adopted technology in history. While the internet took 15 years to reach global scale, and mobile computing took eight years, AI is estimated to reach a similar scale in just three-to-four years.
“The growth of AI relies heavily on physical infrastructure alongside software. Hence, its adoption is already driving large-scale investments in hyperscale data centres, semiconductor capacity, power infrastructure, and advanced cooling and storage systems,” Bajaj Finserv AMC noted.
This will likely create structural demand in metal, energy, and power equipment, semiconductor, and battery energy storage systems, it added.
What does it mean for IT sector?
For traditional IT companies, adaptability will determine the leadership in this sector in the next phase, Bajaj Finserv AMC said. This evolving risk-reward profile is a primary driver of the asset manager’s moderated exposure to the sector.
AI is slowly dismantling traditional service models, which will slowly shift most opportunities up the value chain. These opportunities will show up in AI integration and system design, cybersecurity and data architecture, cloud and platform orchestration, and domain-led digital transformation.
Where does India stand in AI transition?
In terms of third-party data centre capacity, India has crossed over 1,000 megawatt (MW) at present. This will likely scale to 3,250 MW by 2030, which implies a 24 per cent compound annual growth rate (CAGR), the asset manager said.
Bajaj Finserv AMC believes that India’s participation in digital infrastructure is relatively small, despite generating nearly 20 per cent of global data. This hints at an opportunity for structural catch-up.
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