Luckin Coffee (NASDAQ: LK), traded at all time highs on Monday as the stock continues to steam ahead in tandem with the growth of its store count now surpassing Starbucks in China.
Luckin is now the largest coffee chain in China: As context, Luckin took two years from its inception to overtake the 41,00 store count of Starbucks (NASDAQ: SBUX) which took two-decades to build out. The store count for both companies are changing literally by the day
The stock hit US$36 on December 23, up from a low of US$13 in May, just a few days after its IPO. Analysts expect the company to earn US$2.1 billion in annual revenues by 2020 up from some US$743 million. Fuelling this growth are new store sales. Luckin Coffee formed in 2017 and listed this year, now operates 4,280 according to its website. This growth represents a more than 200 per cent rise year on year, at the time of this report.
Luckin’s prices its coffee noticeably lower than Starbucks. That results in Starbucks by default being set to serve wealthier customers. Starbucks lattes cost roughly US$4.30 a cup whereas “Luckin is way more affordable at $1.50,” according to a source in China.
Lets see how Luckin continues to grow the coffee culture in the traditionally tea drinking country.