Luckin Coffee, the Chinese coffee giant, is once again setting its sights on the lucrative Persian Gulf markets, a strategic move confirmed by its chairman, David Li, in an exclusive interview with CNBC. This renewed push for overseas expansion comes hot on the heels of securing significant investment from Abu Dhabi's sovereign wealth fund, Mubadala.
Li, who is also the co-founder and CEO of Centurium Capital – Luckin’s controlling shareholder – revealed that senior management is actively exploring entry into Gulf countries. This follows a substantial $1 billion joint investment by Mubadala and Centurium in early September, cementing Mubadala's direct stake in the coffee chain.
The move marks a significant turnaround for Luckin, which had previously eyed the Middle East and India in 2019 but aborted those plans after a high-profile accounting scandal. That fraud led to its U.S. bankruptcy filing and delisting from Nasdaq. However, under Centurium's stewardship, Luckin has dramatically revitalized its operations, even surpassing Starbucks to become China's largest coffee chain by sales.
CEO Jinyi Guo highlighted the appeal of the Gulf region, citing stable, high-frequency coffee demand and a growing consumer preference for healthier, low-sugar beverage options. The company's impressive recovery has attracted a growing roster of institutional investors, including Singapore’s Temasek, which recently disclosed a 6.4% stake.
While Luckin's overseas presence is currently modest—with 23 stores in New York City, 150 in Malaysia, and 100 in Singapore—its domestic footprint is formidable, boasting over 36,000 stores across mainland China and Hong Kong. The company reported a robust 28.5% revenue growth in the second quarter, reaching 15.9 billion yuan ($2.34 billion), with monthly transacting customers soaring by 23% to 112.7 million.
The company, currently trading over-the-counter and valued at approximately $9.6 billion, is also actively pursuing a relisting on a U.S. mainboard, though it awaits Chinese regulatory approval and has no clear timeline. This expansion into the Middle East underscores Luckin's ambition to cement its global footprint beyond its dominant Chinese market.
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