Dividends are an attractive source of passive income for investors.
Not only do they flow straight into your bank account, but they are also exempted from personal income tax, thereby providing you with a tax-free additional income source.
Income investors have reasons to rejoice as the Singapore stock market is filled with many attractive dividend-paying stocks that sport good dividend yields.
What you may want to look for, however, are stocks with the potential to increase their dividends.
By doing so, these companies can help you to beat inflation and also supply you with a steadily-increasing income stream.
Here are four Singapore stocks that look well-positioned to increase their dividends in 2025.
iFAST Corporation Limited (SGX: AIY)
iFAST is a financial technology company that operates a platform for the buying and selling of unit trusts, shares, and bonds.
The group reported an impressive set of earnings for the first nine months of 2024 (9M 2024).
Net revenue shot up 75.5% year on year to S$183.5 million, led by higher contributions from iFAST’s Hong Kong ePension project.
Operating profit more than doubled year on year to S$60.1 million while net profit more than tripled year on year to S$47.4 million.
The group’s assets under administration (AUA) climbed 23.6% year on year to hit a record high of S$23.62 billion as of 30 September 2024.
For its third interim dividend, iFAST declared a dividend of S$0.015, an increase of S$0.002 compared with the prior year’s S$0.013.
Management believes that the ePension division will be an important growth driver this year, while its overall wealth management platform should also show healthy progress.
Its digital bank division, iFAST Global Bank, saw deposits jump 124% year on year to S$805.6 million and the group expects this division to also become an important growth driver for this year.
Should these two divisions increase their contributions to overall group profit, there is a high chance that iFAST can continue to increase its dividend payout.
DBS Group (SGX: D05)
DBS needs no introduction, being the largest of the three local banks with a prominent local presence.
The group delivered an impressive financial performance for 9M 2024 and there are hints that 2025 could see more of the same.
For 9M 2024, DBS’s total income rose 11% year on year to S$16.8 billion on the back of a 5% year-on-year increase in net interest income to S$11.2 billion.
Net profit stood at S$8.8 billion, a new high, and was up 12% year on year.
In line with the good results, DBS paid out a quarterly dividend of S$0.54, 23% higher than the S$0.44 paid out in the previous year.
CEO Piyush Gupta delivered a sanguine outlook for this year and expects pretax profits to be around 2024 levels.
Non-interest income is also expected to grow in the high-single-digits year on year.
With the new President-Elect Donald Trump’s policies being potentially inflationary, interest rates in the US could remain higher for longer, thus providing a boost for DBS’s net interest income.
The lender also confirmed that it has excess capital of close to S$6 billion that could be returned to shareholders in the form of increased dividends or a special dividend.
Back during 2023’s Investor Day, management also reiterated that it could increase its ordinary dividend by S$0.24 per year barring unforeseen circumstances.
Riverstone Holdings (SGX: AP4)
Riverstone is a manufacturer of nitrile and natural rubber gloves for the cleanroom and healthcare industries.
The group owns six manufacturing facilities in Malaysia, Thailand, and China with an annual production capacity of 10.5 billion gloves.
Riverstone pulled off an impressive financial performance for 9M 2024 as revenue rose 16% year on year to RM 794.8 million.
Gross profit leapt 46.8% year on year to RM 300.3 million as gross margin expanded from 29.9% to 37.8%.
Net profit climbed almost 42% year on year to RM 216.9 million.
Free cash flow for 9M 2024 also climbed 40.2% year on year to RM 190.3 million.
An interim dividend of RM 0.04 was declared for the third quarter, taking the year-to-date dividend per shar to RM 0.12.
Riverstone is building additional production capacity for healthcare gloves.
Three additional healthcare lines are expected to be ready by the first quarter of 2025.
Should Riverstone enjoy higher revenue and profits again this year, the glove maker could raise its dividends further.
Civmec Ltd (SGX: P9D)
Civmec is an Australian integrated construction and engineering services provider to the energy, resources, and infrastructure sectors.
Back during its fiscal 2024 (FY2024) press release for the fiscal year ending 30 June 2024, Civmec saw revenue jump 24.4% year on year to A$1 billion.
Net profit improved by 11.6% year on year to A$64.4 million.
The engineering firm raised its final dividend by 16.7% year on year to A$0.035.
For its first quarter of fiscal 2025 business update, revenue climbed 7.2% year on year to A$262.7 million but net profit stayed flat year on year at A$15.2 million.
In November last year, Civmec was awarded the design and construction works for the delivery of a new major shiploader with the project value in the region of A$90 million to A$100 million.
Management did warn that delays in the timing of project awards may result in lower activity levels for the business.
However, tendering activities remain at historically high levels and with better revenue and earnings, Civmec could continue to up its dividend payments.
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Disclosure: Royston Yang owns shares of DBS Group and iFAST Corporation Limited.
