Kingdee International Software Group plans to boost research and development spending on its enterprise software suite, and expects the product to post a profit within two years. The GEM-listed firm would spend 10 per cent to 15 per cent of its earnings on research and development, executive director and senior vice-president Mison Law Ming-sing said yesterday. 'We will spend more on development of our enterprise software this year and next,' Mr Law said. 'We expect to realise profits from the division in 2006 or 2007.' Kingdee's research and development expenditure soared 108.73 per cent to 53.79 million yuan last year, while its sales expenses rose 18.77 per cent to 228.78 million yuan, mainly on branding exercises for enterprise application suites. The firm spent 3.26 million yuan to change its listing to the main board from the GEM, which is expected to take place this year. The added expenditure pushed profits down by 7.04 per cent to 54.96 million yuan last year, despite a 21.97 per cent rise in turnover to 445.92 million yuan. Kingdee hoped to expand its market share in the small and medium-sized enterprises market to 30 per cent this year from about 20 per cent last year. It expected more than 60 per cent of customers to buy software maintenance services, chairman and chief executive Robert Xu Shaochun said. 'We will be very active in 2005,' Mr Xu said. 'We will not compete with, but work with global software giants such as Oracle and SAP to expand in the mid-level market.' Kingdee is also talking to Indian firms on partnership opportunities. 'Some Indian firms have multinational clients expanding into China. It's a market they can't serve but where we fit in,' Asia-Pacific general manager Toa Charm said. Sitting on cash and cash equivalent of 214.71 million yuan, Kingdee is looking for acquisition targets in application software industries catering for property, finance and logistics firms.