2022 promises to be a better year with economies slowly recovering amid the reopening of borders.
Amid this improvement, many businesses are poised to enjoy stronger demand for their goods and services.
It’s good news for investors as this demand will translate to higher revenue and profits for these companies.
And with higher profits, the probability of a dividend boost also increases.
An increase in dividends will be music to an income-focused investor as this means he or she will enjoy a higher stream of passive income.
Here are five blue-chip stocks that could raise their dividends this year.
Venture Corporation Limited (SGX: V03)
Venture Corporation is a provider of technology products, services and solutions.
It manages a product portfolio of more than 5,000 products and solutions and hires over 12,000 employees worldwide.
For the first nine months of 2021 (9M2021), Venture reported that revenue inched up 0.8% year on year to S$2.2 billion.
Net profit rose by 3.2% year on year to S$217.4 million.
For the previous year, fiscal year 2020, the group had declared a total dividend of S$0.75, higher than the prior year’s dividend of S$0.70.
For its fiscal 2021 first half (1H2021), Venture kept its interim dividend constant at S$0.25 per share.
The technology group expects continued strong demand for its products and services in the next 12 months.
It is optimistic about recovery and is seeing new product introductions for its clients which will flow through to mass production at Venture’s plants in the coming year.
With this sanguine outlook, there’s a good chance that Venture may increase its final dividend for FY2021.
Singapore Technologies Engineering Ltd (SGX: S63)
Singapore Technologies Engineering, or STE, is a global technology, defence and engineering group that serves customers in more than 100 countries.
The engineering giant reported an encouraging set of numbers for 1H2021.
Revenue rose by 2% year on year while net profit jumped by 15% year on year to S$296.1 million.
The group declared an interim dividend of S$0.05, unchanged from a year ago.
STE’s fiscal 2021 third quarter (3Q2021) business update demonstrated continued strength in its business.
More than S$1.8 billion worth of new contracts were snagged during the quarter.
As a result, STE’s order book stood at S$18.2 billion as of end-September 2021, up 18% from the level it was at end-December 2020.
The group is charting a five-year growth plan that could further boost its prospects, and could potentially increase its FY2021 dividend in line with its good results.
DBS Group (SGX: D05)
DBS, as the largest bank in Singapore, needs no introduction.
The group reported a stellar set of earnings for 9M2021, chalking up a record S$5.4 billion net profit.
The lender restored its interim dividend to S$0.33 per share, thanks to Singapore’s central bank lifting dividend restrictions on banks.
DBS could have room for further dividend increases.
With inflation rearing its ugly head, interest rate rises may be on the cards.
DBS’ net interest income could receive a boost once rates head up, resulting in higher profits for the bank.
Its strong fee income and healthy loan growth will also act as catalysts to further propel net profit higher.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.
SGX reported a robust set of earnings for its FY2021 ended 30 June 2021.
Revenue stayed flat at S$1.05 billion while net profit dipped by 6% year on year to S$445 million, primarily due to expenses related to two acquisitions during the fiscal year.
A quarterly dividend of S$0.08 per share was declared and paid.
SGX has highlighted various avenues for growth during its recent Analyst Day.
One of these is the growth of ETFs.
SGX reported that its combined assets under management for ETFs surged by 47% to S$12.55 billion in 2021, while it expanded its offerings to 35 ETFs, up from 30.
SPACs represent another promising area for the bourse operator, with the two, from Vertex Technology Acquisitions Company and Pegasus Asia, set to debut in late January.
Genting Singapore Limited (SGX: G13)
Genting Singapore owns and operates an integrated resort, Resorts World Sentosa (RWS), in Sentosa, Singapore.
RWS features six hotels with around 1,600 hotel rooms, a casino, and a Universal Studios theme park.
For its 3Q2021 business review, total revenue declined by 16% year on year to S$251.5 million while net profit rose by 11% year on year due to an accounting write-back related to its Yokohama IR bid.
The integrated resort operator paid out a full year 2020 dividend of S$0.01.
With borders gradually reopening and air travel resuming in earnest, Genting Singapore should enjoy a strong uplift in its revenue and net profit.
What do real estate, Malaysia, Asia’s retail and healthcare have in common? They are a rich source of dividends! And in 2022, these 4 sectors look to be full of companies with healthy cash flows and dividends. If you want to own some of these stocks yourself, then grab a copy of our latest special report. Click here to download it for FREE.
Disclaimer: Royston Yang owns shares of DBS Group and Singapore Exchange Limited.