Looking for Dividends and Growth? 3 Singapore Blue-Chip Stocks You Can Consider Buying

Income investors are lucky to be able to access a wide range of dividend-paying stocks on the Singapore Stock Exchange.

The general belief is that dividend stocks do not exhibit much growth as the companies are paying out a large chunk of their earnings rather than reinvesting it.

Hence, many investors gun for either income stocks or growth stocks to fill their portfolios.

However, there are stocks out there that can offer an attractive mix of both growth and dividends.

Here are three Singapore blue-chip stocks that have demonstrated good growth while also dishing out dividends.

DBS Group (SGX: D05)

DBS needs no introduction as its presence is ubiquitous around Singapore.

The largest bank by market capitalisation offers a wide range of services such as banking, insurance, and investments to its clientele.

The lender has done well throughout the pandemic and recently made headlines when it reported its highest-ever net profit for 2023.

Last year, DBS saw its net interest income jump 33% year on year to S$14.3 billion as higher interest rates boosted its business.

Total income increased by 22% year on year to S$20.2 billion while profit before allowances climbed 29% year on year to S$12.1 billion.

Net profit climbed 23% year on year to S$10.1 billion, a new record.

Over the past five years, DBS’s share price has risen by 31.8% to close at a near-52-week high of S$36.12.

The lender also paid out a total core dividend of S$1.92 per share for 2023, 28% higher than the S$1.50 that was paid out in 2022.

2022’s total dividend also included a special dividend of S$0.50 per share.

In line with the good results, DBS has upped its quarterly dividend to S$0.54 per share, bringing its annualised dividend to S$2.16.

To sweeten the deal, management has also declared a 1-for-10 bonus issue of shares that are entitled to the increased quarterly dividend moving forward.

During DBS’s Investor Day last year, the bank committed to increasing its ordinary dividend by S$0.24 per year barring unforeseen circumstances.

Management is also open to returning excess capital to shareholders in the form of share buybacks or special dividends.

Sembcorp Industries Ltd (SGX: U96)

Sembcorp Industries, or SCI, is an energy and urban solutions provider with a balanced energy portfolio of 21.3 GW and a project portfolio spanning more than 14,000 hectares.

SCI has performed very strongly over the past five years with its share price almost doubling during this period from S$2.71 to S$5.41.

The utility group reported a mixed result for 2023 with revenue dipping by 10% year on year to S$7 billion.

Net profit excluding exceptional items, however, climbed 38% year on year to S$1 billion.

Management also doubled its final ordinary dividend from S$0.04 to S$0.08.

The increase brought 2023’s dividend to S$0.13, slightly higher than 2022’s dividend of S$0.12 (which included a special dividend of S$0.04).

Management is committed to growing the group’s renewables portfolio further, as mentioned during last year’s Investor Day.

A target of 25 GW by 2028 has been set for its renewables portfolio and SCI is diligently working towards this goal.

Just last month, the urban planning group signed several deals to advance its goal of achieving a larger renewables portfolio.

SCI will build a utility-scale integrated solar and energy storage project in Indonesia backed by a 25-year power purchase agreement (PPA).

A second contract award will see the group build a wind-solar hybrid power project under a 25-year PPA.

These two contracts will increase SCI’s global renewables capacity to 14.3 GW.

Yangzijiang Shipbuilding Holdings Ltd (SGX: BS6)

Yangzijiang Shipbuilding, or YZJ, is one of the largest private shipbuilding companies in China.

The group owns four shipyards in Jiangsu Province that can produce a wide range of commercial vessels such as large containerships, bulk carriers, and LNG carriers.

YZJ’s share price had an impressive run, more than doubling in the past five years from S$0.87 to S$1.77.

The shipbuilder reported a sterling set of earnings for 2023.

Revenue rose 16.5% year on year to RMB 24.1 billion with gross profit leaping by 69.2% year on year to RMB 5.4 billion.

Net profit surged by 57% year on year to a record high of RMB 4.1 billion.

A final dividend of S$0.065 was declared for 2023, a step up from the S$0.05 that was paid out in 2022.

2023 turned out to be a spectacular year for YZJ as it snagged total orders of US$7.05 billion, more than double its original 2023 target of US$3 billion.

Its order book has also swelled by 38% year on year from US$10.5 billion to US$14.5 billion, positioning the group for better times ahead.

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Disclosure: Royston Yang owns shares of DBS Group.

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