Luckin Coffee (LKNCY, Financials), China's largest coffee chain, is preparing to enter the U.S. market in 2024, aiming to compete with rivals such as Starbucks by offering lower-priced drinks, the Financial Times reported.

According to those acquainted with the situation, the Xiamen-based business has been setting the foundation for the U.S. debut by developing its supply chain and tailoring its technologies. The development comes almost five years after Luckin was discovered exaggerating revenues after its $645 million initial public offering in the United States in 2019, which resulted in a flood of investor lawsuits and its removal from Nasdaq.

For the first time in 2023 Luckin's yearly income of 24.9 billion yuan ($3.5 billion) exceeded Starbucks's China revenue. Luckin's income climbed 35% to 8.4 billion yuan in the second quarter of this year, while net income came out to be 871 million yuan, the the Financial Times said.

While Starbucks has around 7,300 locations in China, the firm now has 20,000 outlets there. Luckin is focusing on U.S. locations like New York with sizable Chinese student and visitor numbers. To raise brand recognition before its introduction, it has broadcast commercials during NBA events. With an eye toward undercutting rivals, the business intends to offer coffee for $2 to $3.

Luckin has changed senior executives since the fraud affair, including firing founder Lu Zhengyao, who the business says was in charge of the misbehavior. Currently the majority stakeholder is Beijing-based private equity firm Centurium Capital, according to the report.

Luckin intends to fit its app-based, cashless ordering system to the American consumer scene.