The IPO values Luckin at $3.9 billion, a jump of more than 30% from its previous valuation of $2.9 billion that had been achieved in an April funding round. “Right now investors look at the company and they see growth, and that looks exciting,” says Ben Cavender, director of Shanghai-based consultancy China Market Research Group (CMR). To win customers from Starbucks, the company subsidizes its coffee products through promotions like "buy one and get two for free." More On Forbes: How Luckin Coffee Is Burning Through Cash To Overtake Starbucks In ChinaTo be sure, the company does have a number of factors working in its favor. According to consultancy Mintel, China’s coffee market is projected to grow at an annual rate of 12.3% and reach 29.2 billion yuan ($4.3 billion) by 2023, suggesting ample future opportunities.

Source: Forbes May 17, 2019 11:03 UTC