Luckin Coffee Saga: Challenges For Chinese Companies Listing Overseas

by GoNews Desk 1 month ago Views 1732
Luckin Coffee, the US-listed Chinese coffee chain that gained huge popularity in a span of few years, rocked the market when it announced that its chief operating officer and other employees fabricated sales transactions.

One of the world's fastest-growing coffee brands and Starbucks rival in China revealed on April 2 that an internal probe found that its COO Jian Liu and employees may have forged its 2019 sales. Following the revelation, shares of the Nasdaq-listed company plunged as much as 82%. 

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China’s securities regulator said it would investigate claims of fraud and strongly condemns any financial misconduct.

In an exclusive interview with Hey China, International Trade & Business Attorney Yi Wang and Lu Gang of TechNode speak on concerns and challenges for Chinese companies planning on listing overseas, among others.

Key points discussed:

  • Why did the accounting scandal come to light now?
  • Trust matters: Should international investors be more cautious? 
  • Will there be reputational risk for Chinese companies listed overseas
  • What’s the impact on Chinese start-ups planning to go public?
  • Chinese companies have to improve their internal auditing processes
  • "China's speed comes with a lot of problems"
  • "Luckin is still a very good company compared to Chinese standards... others are much worse."
Here is the full video by Hey China

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