Luckin Coffee (ticker: LK), Starbuck’s China challenger, continues to grow fast with aggressive new store openings and more menu options. Revenue for the second quarter should shoot up, says one analyst, and more growth is on the way.
The back story. Luckin Coffee, which went public in May, aims to topStarbucks (SBUX) as the largest coffee chain in China in terms of the number of stores by the end of this year. Luckin officially entered the competitive tea market in China earlier this month with its new tea-based drink product line. Retail prices for the tea drinks are similar to their coffee counterparts, but the profit margins are likely to be lower due to promotional campaigns and the higher costs of non-coffee items.