Luckin Coffee(US:LKNCY) First Shanghai Securities·2024-08-01 10:23Investment Rating - The report maintains a "Buy" rating for the company with a target price of $32, indicating a potential upside of 52.4% from the current price [1]. Core Insights - The company reported total revenue of 8.4 billion RMB for FY24Q2, representing a year-over-year increase of 35.5%. Revenue from self-operated stores was 6.28 billion RMB, up 39.6%, while franchise store revenue was 1.85 billion RMB, up 24.5% [1]. - The company experienced a slowdown in store expansion, with a total of 19,961 stores at the end of Q2, adding only 1,371 new stores compared to 2,342 in FY24Q1 [1]. - Same-store sales growth (SSSG) for self-operated stores was -20.9%, indicating a decline influenced by previous rapid store openings and ongoing promotional activities [1]. - The company’s operating profit margin for self-operated stores improved to 21.5%, with overall gross margin increasing by 6.8 percentage points quarter-over-quarter [1]. - Active user count reached nearly 60 million, with a significant increase in monthly transaction users by 61.8% year-over-year [1]. Financial Overview - Revenue is projected to grow from 24.9 billion RMB in 2023 to 32.3 billion RMB in 2024, reflecting a growth rate of 29.5% [3]. - The net profit attributable to shareholders is expected to increase from 2.8 billion RMB in 2023 to 2.6 billion RMB in 2024, with a notable growth of 580.1% in 2023 [3]. - Earnings per share (EPS) is forecasted to rise from 1.15 RMB in 2023 to 1.06 RMB in 2024, with a significant increase of 475.8% in 2023 [3].