The Spanish champions had to settle for second spot in Group D to Borussia Dortmund, but the Croatia international nonetheless feels Real are the team to beat in the knockout stages.

"Whoever we draw in the next round it will be a hard tie, but if we play as we can then we will be favourites to advance," Modric told reporters.

"In fact, I think we are the favourites to win the Champions League."

The 27-year-old impressed in Real's 4-1 win over Ajax on Tuesday, and he is pleased with the way things are going for him at the Liga champions.

"I have been here three months now and I am used to the rest of the players and the coach's demands. I am happy with my progression," he said.

Modric has made 18 official appearances for Real so far this term, scoring once.