Ola Electric Mobility, India’s leading e-scooter manufacturer, has achieved a significant milestone by reaching a valuation of Rs 58,664 crore ($6.99 billion) after a 20% surge in its stock value on Friday. This impressive leap follows the launch of its new line of e-motorcycles and the company’s strategic plan to cut costs by producing its own batteries.

The company’s entry into the e-motorcycle market is expected to heighten competition within India’s expansive two-wheeler sector, where it will contend with major players such as Bajaj Auto, TVS Motor, and Hero Motocorp. India’s two-wheeler market is substantial, with 18 million units sold in the previous year, and Ola Electric’s new offerings are poised to make a significant impact.

Ola Electric, which went public on August 9 with a $734 million initial public offering (IPO), has seen its shares rise by 75% since the listing price of Rs 76. Although it initially set a valuation target of $5.4 billion in September 2023, the IPO valuation was adjusted to $4 billion due to global tech corrections and to attract investors.

The company’s plan to develop and integrate its own battery technology and increase local production of EV parts has garnered positive attention from investors. HSBC has given the company a “buy” rating, with a target price of Rs 140, citing favorable regulatory support and potential cost reductions.

Despite reporting a wider first-quarter loss due to subsidy cuts, Ola Electric’s expansion into e-motorcycles and its future battery production are seen as steps toward solidifying its market position. The company’s new motorcycle line aims to cater to both the mass and premium segments of the market, potentially boosting its competitive edge against traditional motorcycle manufacturers.

As electric vehicle adoption in India gradually increases, challenges such as range concerns, insufficient charging infrastructure, and low resale value remain. However, Ola Electric’s strategic moves are likely to accelerate the growth of the EV sector in the country.