Under Luckin's Mask
Luckin coffee, which has long been under targeted by Muddy Waters Research for two months, finally revealed on April 2 that its chief operating officer had falsified results of 2.2 billion yuan, inflating related expenses and expenses, which is like dropping a depth bomb. After the announcement, luckin coffee's opening plunge of more than 80 per cent triggered a trading halt, followed by six circuit breakers in 40 minutes. Luckin shares closed at $6.40, down 75.57%. Before Thursday's slump, its shares had risen 54% since listing last year.
Several law firms in the US have filed a class action against Luckin, accusing the company of making false and misleading statements in violation of US securities laws.
Luckin's 18-month IPO created a capital myth that now looks like a beautiful bubble. Fraudulent listing is impossible to prevent, but there will always be some people in the face of interest temptation and risk, only strict accountability and investor protection can maintain the order of capital market operation. Finally, we should pay attention to the collateral risk caused by Luckin's credit on Chinese concept shares. Such serious fraud may make some investors have doubts about the authenticity of Chinese concept shares as a whole.
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