Consumer electronics startup boAt has raised $100 million from Warburg Pincus, a U.S.-based private equity giant, reportedly at a valuation of about $300 million. The headphones maker, known for its budget-friendly earphones and speakers, is seen as one of the most successful electronics hardware startups from India post the deal.

The company—which was founded in 2016—will utilise the money to boost its research and development capabilities and product portfolio, besides other areas.

“The investment is a fundamental bet on the wearables segment of the consumer technology market in India and not a classic hardware bet at all. Affordable price point, emphasis on design, and positive profitability seems to be a differentiator for boAt,” says Barnik Chitran Maitra, managing partner & CEO, Arthur D Little, India and South Asia.

As per data from International Data Corporation, a market intelligence and research firm, during the September quarter, boAt was among the top five in the global wearables market.

Kanwaljit Singh, founder and managing partner at Fireside Ventures, and an early investor in the Delhi-based company, points out that boAt has grown to become the market leader in the lifestyle accessories segment. “It is the perfect example of a consumer brand built successfully on quality, consumer insights, smart pricing, and focussed marketing. Given our interest in the consumer brand category, we spotted and saw the prospects of a high-growth consumer startup addressing the audio needs of millennials and Gen Z,” says Singh, adding that an investment by Warburg Pincus is a testament to the long-term growth potential of Indian consumer startups.

However, Maitra cautions that delivering on product innovation in terms of features, functionality, and assortment of devices will be critical to remaining relevant in the affluent youth market of India.

The company’s product portfolio provides well-designed products at attractive price points. boAt claims to have achieved 100% revenue growth over the past years and a strong profitability profile.

Aman Gupta, co-founder, boAt, says, “This is a vote of confidence for our business model and growth prospects. The investment has come at the right time as we make efforts to ramp up our manufacturing and global supply chain.”

“Going forward, with the government’s support, we will focus on building capabilities in domestic R&D and undertake vertical integration across hearable and wearable,” adds Sameer Mehta, co-founder, boAt.

Avendus Capital acted as the financial advisor to the company on the transaction.

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