Because we guess that the sentence reffer to something in the previous one. Else, we could also say "Il l'a beaucoup aimé" We could have those sentences equally correct: Il a bu un café. Il a beaucoup aimé. Il a bu un café, Il l'a beaucoup aimé. But maybe we can also have "Il a beaucoup aimé" to resume one, two or many sentences. Example: Il est allé à Paris le weekend dernier. Il a visité la Tour Eiffel et le Louvre. Il a visité l'exposition de Tim Burton et ensuite a bu un café dans un endroit chic. Il a beaucoup aimé! (= I liked a lot all of these things)

You're right it means il a beaucoup aimé , the it is not said indeed we could write instead, il a beaucoup aimé cela. Cela = it