HDFC Capital announces initial close of US$376 million for Scheme 2, H-CARE 3

HDFC Capital, a subsidiary of HDFC Ltd and acting as an investment manager, has successfully achieved the initial close for Scheme 2 of the HDFC Capital Affordable Real Estate Fund - 3 (H-CARE 3). H-CARE 3 Scheme 2 combined with H-CARE 3 Scheme 1 (raised less than 1 year ago) and HDFC Capital Affordable Real Estate Funds - 1 & 2, raised in 2016 and 2017 respectively, creates a US$3.1 billion funding platform which has been rated as one of the world's largest private finance platforms focused on development of affordable housing. The primary investor in H-CARE 3 Schemes 1 & 2 is a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA).

H-CARE 3 will provide long-term, flexible funding across the lifecycle of affordable and midincome housing projects including early-stage funding. In addition, H-CARE 3 will also invest in technology companies (construction technology, fin-tech, sustainability-tech etc.) engaged in the affordable housing ecosystem.

Set up in 2016, HDFC Capital is aligned with the Government of India's goal to increase housing supply and support the Pradhan Mantri Awas Yojana - 'Housing for All' initiative. HDFC Capital's target is to finance the development of one million affordable homes in India through a combination of innovative financing, partnerships and technology, whilst focusing on sustainability. In order to achieve this objective, the company is in active discussions with leading global investors to raise additional funds to be invested in affordable housing in India.

H-CARE 3 Scheme 1 & 2 Overview

- HDFC Ltd will be the Sponsor and HDFC Capital will be the investment manager for H-CARE 3 Schemes 1 & 2.

- Investor and Sponsor have committed c. US$376 million to H-CARE 3 Scheme 2. H-CARE 3 Schemes 1 & 2 combine to create a total estimated fund corpus of US$2.2 billion (including potential reinvestments) making H-CARE 3 one of the largest funds raised to invest in the residential real estate sector in India.

- Primary focus on providing long-term, flexible debt across the lifecycle of real estate projects (including land, approval and last mile funding) for the development of affordable and mid-income housing across India.

- H-CARE 3 has flexibility to:

- Provide equity funding for real estate projects
- Invest in tech companies (construction technology, fin-tech, sustainability-tech etc.) that address the needs of the affordable housing ecosystem.

- The H-CARE 3 funds are expected to be committed towards investments over the next 3-4 years.

Mr. Deepak Parekh, Chairman - HDFC Ltd, said, "Despite the recent headwinds in the global macro landscape, I continue to be optimistic about the demand for homes in India. As the pivot of global growth shifts, India is envisaged to remain amongst the fastest growing major economies In India and housing will play an even more important role as a catalyst for growth. HDFC Capital has been one of the pioneers of investing in affordable and mid-income housing projects in India. With the support of leading global investors like ADIA and partnerships with trusted developers, the HDFC Capital platform is well on its way to achieve its medium-term goal of funding one million affordable homes in India."

Vipul Roongta Managing Director & CEO, HDFC Capital said, "Urbanization is an irreversible trend in India which combined with the thrust given to affordable housing by the government will result in an exponential growth in the demand for affordable and mid-income homes. At HDFC Capital, our vision is to finance the development of the affordable housing ecosystem in India and provide a seamless platform for all stakeholders including global investors, developers, and vendors to access financing and technology innovations to develop sustainable and smart affordable homes."

Mr. Mohamed AlQubaisi, Executive Director of the Real Estate Department, ADIA, said, "Through the H-CARE funds, HDFC has established a successful track record of supporting the development of new affordable residential stock across the country. Our latest investment in the H-CARE platform aims to support its growth as it continues to meet the growing demand for early-stage financing of housing projects in India."

Shares of Housing Development Finance Corporation Limited was last trading in BSE at Rs. 2615.80 as compared to the previous close of Rs. 2594.85. The total number of shares traded during the day was 17306 in over 1269 trades.

The stock hit an intraday high of Rs. 2629.00 and intraday low of 2592.50. The net turnover during the day was Rs. 45207446.00.

Source : Equity Bulls

Keywords

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