New Delhi, Sept. 17 -- When India slashed taxes on petrol two-wheelers this month, it should have been bad news for electric bike makers. Instead, their stocks are on fire.

In fact, since the Goods and Services Tax Council announced changes to the goods and services tax (GST) on the evening of 3 September, stock prices of two listed electric two-wheeler makers-Ather Energy and Ola Electric Mobility Ltd-have surged 39% and 42%, respectively. By contrast, shares of four leading internal combustion engine (ICE) two-wheeler companies-Bajaj Auto Ltd, TVS Motor Co. Ltd, Hero MotoCorp Ltd, and Eicher Motors Ltd-have risen 10.5-20% in the same period.

This is despite the fact that, under the revised GST structure, tax on electric vehicles (EVs)...