IT, trade lead surge in new company registrations; AI tag gains ground

Data from the ministry of corporate affairs (MCA) shows IT companies and wholesale and retail trade firms topped new company registrations in each of the 12 months ending March 2026. The trend underlines not just entrepreneurial activity, but a deeper shift towards digitalization and formalization.

In FY26, over 247,500 companies were registered—up 31% from more than 189,400 companies in the previous year. At the end of March 2026, India had over 2 million active companies.

There has also been a visible surge in companies explicitly branding themselves as AI-focused. At the beginning of FY26, 84 companies in every 10,000 new registrations mentioned ‘AI’ in their names. By March 2026, that number had risen to 120 per 10,000 registrations.

Importantly, AI branding is no longer confined to core IT services. Businesses describing themselves as AI-based are spread across health, education and consultancy, indicating growing cross-sectoral adoption, indicated the data.

The number of companies incorporated with wholesale trade as the main activity ranged between 1,400 and 2,600 per month in FY26. Retail trade businesses incorporated during the year ranged from 900 to 1,400 per month.

On average, fewer than a dozen government companies—central and state combined—were formed each month.

Companies registered in January—the latest month for which detailed incorporation data is available—had average paid-up capital of about ₹6 lakh and authorized capital of roughly twice that amount. However, the actual investment could be significantly higher since debt constitutes a substantial portion of total investments.

Business registrations are often viewed as a proxy for formalization, investment intent and entrepreneurial momentum.

“The consistent rise in new company incorporations, particularly in technology, trade, and AI-enabled activities signals more than just numerical growth,” said Amit Maheshwari, managing partner, AKM Global, a tax and consulting firm.

“It reflects a maturing entrepreneurial mindset in India, closely tied to the country’s accelerating digital adoption. Artificial intelligence is no longer confined to niche start-ups; it is increasingly being enshrined into everyday business models, whether in healthcare, delivery, professional consulting, or operational services,” said Maheshwari.

“This transition points toward a more formalized and technology-driven economy, where start-ups and small and medium enterprises are playing a meaningful role in job creation, efficiency gains, and sustained economic expansion,” he added.

However, incorporation growth exists alongside a large informal economy.

While India has over 2 million active companies, the number of unincorporated enterprises remains far larger.

According to a government survey, such establishments increased from 73.4 million during October 2023–September 2024 to 79.2 million in the January–December 2025 survey period, reflecting growth of about 7.97%.

Employment in this segment grew 6.18%, with more than 7.452 million new jobs added during the period. The informal sector employed 128.1 million people in January–December 2025.