According to Italian outlet Tuttosport (via Football Italia), despite Real blocking a move from Inter for Kovacic in January, the Nerazzurri are set to go back in for him at the end of the season, with sporting director Piero Ausilio still interested.
Meanwhile, it's added AC Milan sporting director Massimiliano Mirabelli is a known admirer of Kovacic, 23, and could compete with Inter for his signature as they look to bolster their midfield.
It is unclear whether Real will even countenance letting Kovacic go in the summer and, if they are open to his departure, what fee they will demand.
The Croatia international signed for Real from Inter for €29 million in 2015, and he has a contract at the Santiago Bernabeu that runs to 2021.
He has struggled to nail down a regular starting spot under manager Zinedine Zidane, which is little surprise given the presence of Luka Modric and Toni Kroos in Real's squad—arguably two of the best central midfielders in the world.
However, Kovacic has been afforded a run in the side recently due to various injuries, and he has given an excellent account of himself.
On Tuesday, he was key as Real ousted Paris Saint-Germain in the UEFA Champions League, continuing his remarkable run in the competition, per Opta:
It is no shock Inter and AC Milan are both reportedly interested in signing Kovacic, as he is a remarkably talented young midfielder.
Comfortable in possession and boasting a fine passing range, he has all the attributes to become a world-class player.
It seems unlikely, then, that Real will be prepared to let him go.
He is still young and, although he is not currently a guaranteed starter, he looks an ideal successor for the 32-year-old Modric in Real's midfield.
The only scenario in which Real might be prepared to let Kovacic go is if they were to receive an astronomical offer for him, but it is unlikely Inter or AC Milan could stump up enough cash to convince Los Blancos to sell.