HDFC Capital to Invest Rs 1500 Crore in Joint Platform with Eldeco Group

HDFC Capital Advisors Ltd, the private equity real estate wing of the HDFC Group, has made a Rs 1500 crore investment through a joint platform with Delhi-headquartered Eldeco Group in developing 18 residential projects across Tier 3 and Tier 2 Indian towns. The platform will be set up to build more than 10 million square feet of residential space with the combined revenue potential of about Rs 11,000 crore, according to the company on April 13.

These new projects will extend across the Haryana town of Panipat and Sonipat, Uttarakhand's Rudrapur and Rishikesh, Ludhiana in Punjab, and Himachal Pradesh's Kasauli. These ventures would focus on capturing increasing demand for quality housing in India's upcountry towns, especially those that fall within a 300-kilometer radius of major metropolitan centers.

HDFC Capital's Managing Director and CEO Vipul Roongta highlighted the strategic significance of Tier 2 and Tier 3 towns. "Our collaboration with Eldeco is in line with our long-term strategy of driving the development of sustainable aspirational housing for India's growing middle class. This is meant to take advantage of the increasing infrastructure development in these cities, bringing the towns closer to metro cities and job centers", he said.

He also stressed Eldeco's good experience in township development in non-metro areas and stated that the alliance will make the affordable and mid-income housing solutions more swift. 

Seconding the observation, Pankaj Bajaj, Managing Director and Chairman of Eldeco Group, stated, "We are glad to collaborate with HDFC Capital in our goal to create flourishing, well-organized communities across India". This investment will enable us to speed up our growth in high-growth markets that are fast being linked with India's economic hubs. Tier 2 and 3 cities have a very large unmet demand for good quality housing. On this platform with HDFC Capital, we will be in a position to meet some of this demand in North Indian cities".

The investment platform is set up with Eldeco Infrastructure & Properties Ltd (EIPL), the unlisted subsidiary of the Eldeco Group. Though EIPL spearheads this venture, Eldeco also has a presence in the Lucknow market through its listed unit Eldeco Housing & Industries Ltd, through a brand license agreement.

This investment is a part of HDFC Capital's larger strategy to facilitate India's mid-income and affordable housing segment in line with the Government of India's 'Housing for All' mission. HDFC Capital is the manager of four SEBI-registered Category II Alternative Investment Funds with a combined $4.2 billion platform investing in housing development in India.

In January, HDFC Capital had put in Rs 1,300 crore in an equivalent platform with realty company Total Environment to fund housing projects valued at Rs 10,000 crore in Bengaluru.

Through its recent tie-up with Eldeco, HDFC Capital continues to strengthen its footprint in India's housing space, particularly in areas expected to see quick urbanization and infrastructure-driven growth.