When we think about dividend income, most investors automatically look to the Straits Times Index (SGX:^STI) for familiar names like the banks, REITs and blue-chip stalwarts.
But if you stop there, you may be missing out on solid businesses outside the STI that quietly compound cash flow and reward shareholders year after year.
Continuing our series on Beyond STI, we shine the spotlight on three under-the-radar dividend payers that can strengthen your retirement income.
Like a savvy football manager who scouts beyond the superstars to find undervalued players, Smart Investors look past the index heavyweights to discover hidden dividend champions within the small-cap space (companies with market capitalisations below S$1 billion).
Today, we look at three dividend stocks which offer investors a compelling mix of steady recession-resilient earnings, high yields backed by long government leases and overseas diversification, and a blend of reliable dividends with long-term growth potential.
Individually, they each play a different role – think of them as your defensive midfielder, creative playmaker, and pacey winger.
Together, they form a dividend dream team that can help build a more robust, diversified, and inflation-resistant income stream for your retirement portfolio.
VICOM (SGX: V01)
VICOM delivered impressive third-quarter 2025 (3Q2025) results with revenue jumping 36% year on year (YoY) to S$41.6 million and net profit surging 45% to S$9.9 million.
The standout performer was the Electronic Road Pricing 2.0 On-Board Unit installation project, with over 78,000 units installed during the quarter, up from 71,000 in the previous quarter.
The company’s financial position remains rock-solid with S$42 million in cash and zero debt.
While free cash flow temporarily turned negative at S$2.5 million for the quarter due to S$12.3 million in capital expenditure for the new Jalan Papan integrated testing centre, the nine-month figure stayed positive at S$3.5 million.
For dividend investors, VICOM offers a 3.8% yield at the current share price of S$1.62.
The key catalyst ahead is the completion of the Jalan Papan facility in the first half of 2026.
Once operational, capital expenditure should normalise, potentially freeing up more cash for higher dividend payments from FY2026 onwards.
The sustained demand from Singapore’s manufacturing and construction sectors, coupled with the ongoing ERP 2.0 rollout, positions VICOM well for steady income generation.
Elite UK REIT (SGX: MXNU)
Elite UK REIT achieved a strong 9.4% YoY increase in distribution per unit (DPU) to £0.023 for the first nine months of 2025 (9M2025), despite ongoing portfolio transformation efforts.
The REIT’s 148 UK properties valued at £419.7 million benefit from exceptional income security, with 99.1% of gross rental income backed by AA-rated UK government tenants.
Distributable income rose 6.2% to £14.8 million, driven by interest savings from active capital management and tax benefits from sustainability investments.
The REIT successfully optimised borrowing costs to 4.8%, with 85% of debt on fixed rates, providing stability in the current rate environment.
The standout development is the portfolio repositioning strategy showing significant progress.
Lindsay House in Dundee received planning approval for conversion to 168-bed student accommodation, with potential for a fivefold valuation uplift upon completion in 2027.
Three strategic acquisitions of government-leased properties added the Department for Environment, Food & Rural Affairs as a new tenant while delivering 0.6% DPU accretion.
For income investors, Elite UK REIT offers an attractive 8.5% dividend yield at the current share price of £0.36, backed by secure government rental income and clear value-creation initiatives through asset repositioning.
Micro-Mechanics (SGX: 5DD)
Micro-Mechanics delivered steady first-quarter FY2025 results with revenue rising 2.9% YoY to S$16.7 million and net profit growing 2.7% to S$3.2 million.
The company maintained an impressive 18.9% net profit margin while improving gross margins to 51.5% from 50.7%, demonstrating strong operational efficiency.
The consumable tools segment was the star performer, surging 7.9% to a 13-quarter high of S$13.7 million and contributing 82.2% of total revenue.
This strength offset weakness in the wafer fabrication equipment parts segment, which declined 15.3% due to material delays and shortages.
Notably, free cash flow jumped 31.4% to S$4.2 million, supported by robust operating cash flow and minimal capital expenditure.
The company maintains a fortress balance sheet with S$27.2 million in cash and zero debt, providing ample flexibility for strategic investments and dividend payments.
At the current share price of S$1.69, Micro-Mechanics offers a 3.6% dividend yield, with distributions typically declared in the second and fourth quarters.
Management’s cautiously optimistic outlook is backed by industry forecasts projecting 9.9% semiconductor market growth to US$800 billion in 2026, while the Five-Star Factory initiative continues driving operational excellence.
Get Smart: Build Your Dividend Dream Team
Just as a championship football team needs more than star strikers, dividend investing isn’t just about finding the highest yield.
It’s about assembling a squad of income sources you can count on, through good times and bad.
These three companies show how scouting beyond the STI can uncover a wider range of players for your portfolio: VICOM as your reliable defensive anchor with stable domestic services, Elite UK REIT as your high-scoring forward delivering global yield, and Micro-Mechanics as your versatile midfielder offering sustainable long-term growth.
No single stock will secure your retirement, but the right team formation can.
Keep an eye on dividend sustainability, debt levels and business fundamentals, and choose companies that can grow their payouts over time.
That’s how you build a retirement income dream team that not only pays you today, but keeps delivering victories well into the future.
Imagine a life where steady income flows, no matter the market. Our new free report, “Retire Early with Dividends,” reveals how. We’ve pinpointed 5 dependable Singapore dividend stocks that offer a proven, stress-free path to financial freedom. Stop just dreaming and start building your early retirement plan today. Your free guide awaits here.
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Disclosure: Calvina Lee does not own any of the shares mentioned. Chin Hui Leong contributed to the article and owns shares of VICOM.
