Autonomous driving technology company WeRide has plenty of room to grow as a result of its early-mover advantage in the global self-driving market, according to Morgan Stanley, which brought the firm public in an IPO last month at $15.50 a share . Analyst Tim Hsiao initiated research coverage of Guangzhou, China-based WeRide with an overweight rating and a price target of $23, implying more than 25% upside for the stock versus Monday’s close. WeRide rallied as much as 6% in early trading Tuesday to $19.43. WeRide offers several driverless vehicles such as robobuses, robotaxis and robovans, holds driverless permits in the U.S., China, the UAE and Singapore and is involved in trial and commercial activities in 30 cities. The company has partnered with Uber in the UAE, and Hsiao expects its robotaxi and robovans segments to achieve large-scale commercialization by 2026. Morgan Stanley estimates the global autonomous driving market size will jump to $1.745 trillion in 2030 from $93 billion in 2025. “WeRide is a pure play in global L4+ autonomous driving,” Hsiao wrote in a 38-page report on Tuesday note. Level 4 autonomous driving describes when a vehicle can drive in most circumstances without a human driver, one step below the top-most Level 5 designation for a fully automated vehicle . Hsiao added that WeRide “can generate greater operating leverage and synergies across products than its peers, given its diverse product offerings.” To be sure, the threat of tighter regulation on driverless vehicles is a downside risk for the stock, and Morgan Stanley forecasts WeRide’s earnings and cash flow will remain “volatile” in the near term, Hsiao noted. WRD ALL mountain WeRide shares since its October IPO. —CNBC’s Michael Bloom contributed to this report.