Kingdee foresees larger space for cloud services

China's push for accelerating the building of new infrastructure amid the coronavirus outbreak will accelerate enterprises' moves to take their business to the "cloud", creating "large room" for growth for cloud services providers, said Xu Shaochun, chairman of Chinese business software specialist Kingdee International Software Group.

At a meeting of the Standing Committee of the Political Bureau of the Communist Party of China Central Committee in early March, President Xi Jinping urged the acceleration of the construction of new infrastructure such as 5G network and data centers.

"This will provide room for our industry's growth, as new infrastructure has to be built on the cloud. We believe enterprises will ramp up efforts to digitalize and make it quicker to take their business to the cloud," Xu said at its 2019 annual results announcement press conference on Thursday.

The Hong Kong-listed company recorded 3.33 billion yuan ($470 million) in operating revenue last year, growing 18.4 percent year-on-year, while net profit to equity holders declined 9.6 percent according to its annual report released on late Wednesday.

Revenue generated from cloud business surged 54.7 percent year-on-year, accounting for nearly 40 percent of the company's total.

Xu said the coronavirus outbreak has pushed for bigger demand for digitalization among enterprises, especially those in medical services, education and modern manufacturing sectors, which will further promote its business growth.

"The SARS outbreak in 2003 accelerated the pace for consumers to go digital. The coronavirus outbreak this year will promote enterprises to turn digital," he said, adding the company will promote innovation on cloud services to help enterprises upgrade.