What if you could avoid paying taxes on your dividend income and pocket all your returns? Well, that’s what astute dividend investors in Singapore have been doing.
You see, Singapore practices the one-tier corporate tax system. As long as the company pays its corporate tax, the subsequent distribution of dividends to individuals would not be taxed anymore. Hence, dividend investors do not have to pay taxes on our dividends! 🥳
Wouldn’t it be a dream come true if you could receive a stream of tax-free dividend income? While looking for dividend stock ideas lately, I stumbled upon 10 Blue Chip stocks with consistent dividend payouts.
All of them have been paying dividends for more than 10 years! Some of them might be suitable for your portfolio.
Here they are:
10 Blue Chip Stocks with Consistent Dividend Payouts
| Company | Ticker | Dividend CAGR (5y) | 5 yr Share Price Return | Dividend Yield | Payout Ratio | Dividend Payout Streak (years) |
|---|---|---|---|---|---|---|
| Wilmar International | F34 | 74.5% | 0.6% | 4.76% | 43.8% | 18 |
| DBS Group | D05 | 13.9% | 33.4% | 5.39% | 43.1% | 32 |
| Oversea-Chinese Banking Corporation | O39 | 8.6% | 13.4% | 6.15% | 49.6% | 32 |
| CapitaLand Ascendas REIT | A17U | 6.3% | 8.2% | 5.00% | 128.7% | 21 |
| United Overseas Bank | U11 | 4.2% | 12.5% | 5.62% | 36.2% | 16 |
| Mapletree Logistics Trust | M44U | 2.6% | 13.9% | 5.21% | 82.7% | 19 |
| Mapletree Industrial Trust | ME8U | 2.2% | 22.5% | 5.34% | 133.2% | 13 |
| Singapore Exchange | S68 | 1.6% | 27.3% | 3.31% | 61.8% | 23 |
| Singapore Technologies Engineering | S63 | 1.3% | 1.6% | 4.11% | 93.7% | 32 |
| Yangzijiang Shipbuilding | BS6 | 0.0% | 114.1% | 3.36% | 36.7% | 16 |
p.s. this list only serves as an inspiration. Not all of these stocks may be worth buying at the point you’re reading this article. Remember to do your own research!
1) Wilmar (F34)
Wilmar is one of the world’s largest oil palm plantation owners. They process and sell consumer products like edible oils, sugar, rice, etc. They also supply products such as animal feed, biodiesel and a range of agricultural commodities.
As a dividend stock, Wilmar is attractive as it has been paying out dividends consistently for over 18 years. The company has also been increasing its dividend per share (DPS) since 2016, with a 5y dividend CAGR of 74.5%.
Wilmar is a rather mature business, so don’t expect much price movement from the stock. This could be an advantage as Wilmar offers relatively low price volatility.
The company is also quite defensive with steady earnings and revenue in the previous years, despite the pandemic:
2) DBS (D05)
DBS needs no introduction. It is one of the 3 major banks in Singapore and also the biggest company in Singapore.
Did you know that DBS has been paying dividends for 32 years?
Although there have been dips in their DPS in certain years, DBS deserves a spot on this list because of its dividend payout streak.
Over the past 10 years, the company has also done well, rewarding investors with a ~95% growth in share price.
We cover Singapore Banks earnings regularly, so subscribe to Dr Wealth to get the latest when its out!
3) OCBC (O39)
OCBC is another major bank in Singapore that has been paying dividends for a long time.
Like DBS, OCBC has also been recovering and increasing its DPS since the pandemic.
The bank has also performed relatively well in the past 10 years, rewarding investors with ~40%.
4) CapitaLand Ascendas REIT (A17U)
CapitaLand Ascendas REIT (CLAR) is Singapore’s largest listed business space and industrial REIT. It continues to grow, delivering positive returns in the tough economy of 2023.
Despite a slight dip in dividends due to the pandemic slow down, a rough recovering economy and rising interest rates in the past years, CapitaLand Ascendas has been rather consistent with their dividend payout.
CLAR maintains a healthy balance sheet with outstanding capital management, enabling it to score a high A3 Moody rating. Looks like the company is likely to keep its 21 years of dividend payout streak going for a long time.
5) UOB (U11)
And yes, of course UOB would make the list. With a 5 year dividend CAGR of 4.2%, UOB has been recovering its DPS since the pandemic:
The bank has also performed relatively well in the past 10 years, rewarding investors with ~42%.
Read about the latest earnings update from Singapore banks here.
6) Mapletree Logistics Trust (M44U)
In 2023, we saw many REITs experiencing a double whammy of reduced dividend payouts and decline in share price due to the high rates environment.
Mapletree Logistics Trust (MLT) zigged while the others zagged, increasing its dividend payout over the past 8 years:
MLT is an Asia focused logistics REIT with a diversified portfolio across 9 Asian countries. The trust reported resilient occupancy rates of 95.9% across its diversified tenant portfolio with a weighted average lease expiry of 2.9 years.
On capital management, the management has done pretty well lowering gearing ratio slightly from the previous quarter. Their debt profile also looks well staggered.
| As of 3Q23 | |
|---|---|
| Gearing Ratio | 38.8% |
| Interest Rate | 2.5% |
| Average Debt Maturity | 3.7 years |
| % of debt with fixed rates | 83% |
Although share price is down in the past year, MLT has delivered +14% in the past 5 years and ~56% in the past 10 years.
7) Mapletree Industrial Trust (ME8U)
Next in the list is another REIT from the same sponsor. Mapletree Industrial Trust (MIT) owns a portfolio of real estate for industrial purposes. The REIT has also been acquiring data centres internationally as part of its latest mandate.
On the dividends front, MIT has been paying dividends for 13 years and have been increasing its DPS for the past 10 years, with an exception of 2023.
With a portfolio of 142 properties, MIT maintains a high occupancy rate of 92.6% with a weighted average lease expiry of 4.4 years.
| As of 3Q23 | |
|---|---|
| Gearing Ratio | 38.6% |
| Average Debt Maturity | 34 years |
| % of debt with fixed rates | 79.5% |
MIT’s tenant profile is sufficiently diversified, with the top 10 tenants contributing about 28.7% of their gross rental income.
Fun fact, in a previous REITs analysis by Alvin, Mapletree was identified as the best performing sponsor in the past 10 years.
8) Singapore Exchange (S68)
Singapore’s stock exchange operator, SGX, operates a platform that allows investors like you and me to trade securities.
SGX has been paying dividends consistently for 23 years and it has been increasing its DPU periodically too:
SGX has been doing relatively well in recent years, they have been increasing their revenue and gross profits.
While it may be difficult to grow a stock exchange in a small country like Singapore, SGX has been actively exploring new products. One example is the Singapore Depository Receipts (SDR). SDRs allow Singapore investors to access investment opportunities from other countries, while enjoying the convenience of investing through SGX.
9) ST Engineering (S63)
ST Engineering is a defence and military manufacturer that had expanded to commercial aerospace and urban solutions. These industries are pretty resilient as they are less influenced by macroeconomic changes.
As a key defense contractor in Singapore, ST engineering should see consistent revenue from its ties with the local government. This is also a form of moat for ST Engineering’s business.
We have also highlighted ST Engineering as one of the 5 recession proof stocks to consider.
ST Engineering has been paying out consistent dividends over the past 10 years, with yields hovering between 4-5%:
In terms of growth, ST Engineering isn’t a particularly exciting stock. It bounces within a predictable range, with a 10 year return of ~-0.5% at the point of writing.
10) Yangzijiang Shipbuilding (BS6)
Yangzijiang (YZJ) is the largest shipbuilder in China and has been enjoying good growth in terms of ship orders, with orderbook size hitting an all-time high in 2023.
YZJ has been paying dividend for 16 years and its DPS is pretty consistent with some fluctuations depending on the performance of the company.
YZJ enjoyed a +165% growth in the past 10 years, with most of that growth contributed in recent years.
Here’s why.
YZJ spun off its investment arm in 2023, making Yangzijiang Shipbuilding a pure shipbuilding stock now. With a large orderbook that guarantees steady revenue in the coming years and a transition to green, environmentally friendly ships, YZJ looks set to perform well. Alex explored the reasons for YZJ’s price surge in detail here.
But wait, there’s more
There were 4 blue chip stocks have also been paying consistent dividends, but didn’t make it into the main list because their 5 year share price return was negative.
If you’d like more stock ideas, grab this report that comes with the 4 additional stocks:
Is it even possible to build a dividend portfolio that pays you consistently?
Well, Chris Ng, our early retirement masterclass trainer did just that. Here’s the latest performance of the ERM portfolio that enjoys a lower beta of 0.63 and a current yield of 6.75%:
You can find more details of his latest portfolio review here and you will discover his strategy here.
