HDFC Capital Advisors, the private equity branch of HDFC Bank, has successfully exited its second investment of ₹1,100 crore in Bengaluru’s Adarsh Developers. This comes from a total commitment of ₹2,500 crore across four investments with the company.
The platform was established in 2022 to develop 17 mid-income residential projects, totaling 10,000 units across 15 million sq ft, in key Bengaluru areas such as Bellandur, Gunjur, Hennur, JP Nagar, and Banashankari.
HDFC Capital’s initial investment of ₹395 crore was exited in Q2 2024 with a gross internal rate of return (IRR) of 21%, while the second investment was exited at a gross IRR of 20%.
“Our partnership with HDFC Capital has enabled Adarsh to launch new projects and ensured the timely completion of ongoing ones. This exit marks a significant milestone for all parties, reflecting substantial value creation. We look forward to further collaboration with HDFC Capital,” stated B.M. Jayeshankar, CMD of Adarsh Developers.
The collaboration with HDFC Capital has aided Adarsh Developers in debt repayment, project initiation, and enhancing its financial stability. The investments’ success was driven by Adarsh Developers’ project execution, resulting in value creation.
“The successful exit showcases our strategy of partnering with leading developers and providing tailored solutions to finance the development of quality homes for mid-income families in India,” commented Kunal Wadhwani, Principal Investments at HDFC Capital.
HDFC Capital Advisors oversees four SEBI-registered Category II Alternative Investment Funds, collectively forming a $4.5 billion platform aimed at financing affordable and mid-income housing throughout India.
This investment strategy aligns with the Government of India’s ‘Housing for All’ initiative, focusing on sustainable housing development while fostering innovation and technology adoption in the real estate industry.
With this second exit, HDFC Capital and Adarsh Developers are expected to continue their partnership on remaining platform investments in mid-income residential projects throughout Bengaluru.
The housing market in India remains strong in 2025, driven by ongoing end-user demand, rising household incomes, and a growing preference for reputable developers. The mid-income and affordable housing sectors have exhibited steady absorption, supported by reduced interest rates and government incentives.
Large institutional investors continue to engage in funding residential platforms, indicating confidence in the long-term potential of urban housing. The Mumbai Metropolitan Region, Bengaluru, and Pune lead in sales activity, with developers emphasizing timely delivery and efficient project management to meet the demand for quality homes.
