In Focus
INTERNATIONAL | Staff Reporter, China
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Luckin Coffee files for U.S. IPO

The Chinese startup is reportedly planning to raise US$500 million to US$800 million.

Confirming earlier reports, Luckin Coffee has filed to list publicly in the U.S. as it competes with Starbucks in its home market.

The Chinese homegrown coffee chain estimated its offering size at US$100 million, as shown in its filing with the U.S. Securities and Exchange Commission but noted that the figure was only set to calculate registration fees.

Reuters sources claim the startup is potentially looking to raise US$500 million to US$800 million from the listing, which is scheduled to take place in May whilst aiming for a valuation of between US$4 billion to US$5 billion.

Luckin is currently valued at US$2.9 billion following its latest fundraising of US$150 million.

The chain, which has been aggressively expanding whilst being in the red, currently operates 2,370 stores in 28 Chinese cities. It has previously expressed plans to open 2,500 new stores this year, which would effectively unseat Starbucks as China's largest coffee brand operator.

According to the prospectus, its acquisition cost per new customer decreased to 16.9 yuan (US$2.52) in the Q1 from 103.5 yuan in the previous period.

Luckin has expanded outside coffee, allowing customers to purchase food and other beverages through its app. The brand notes in the prospectus that coffee consumption in China almost doubled to 8.7 billion cups last year from 4.4 billion in 2013 and is expected to further rise to 15.5 billion cups by 2023.

(Also read: What's driving the brewing coffee war in China?)
 

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