4 Singapore Blue-Chip Stocks Providing a Great Mix of Growth and Dividends

Blue-chip stocks are well-known for their track record of braving through good times and bad.

Most of these stocks also dish out a dividend, giving you a source of passive income that can see you through your retirement.

Despite being large companies with billion-dollar market capitalisations, blue-chip stocks still have room to grow further.

We shine the spotlight on four blue-chip stocks that provide an attractive mix of both growth and dividends.

OCBC Ltd (SGX: O39)

OCBC is Singapore’s second-largest bank by market capitalisation and provides a comprehensive range of banking, investment, and insurance services to both individuals and corporations.

The lender reported a stellar set of earnings for the third quarter of 2023 (3Q 2023) as higher interest rates boosted its net interest income.

For the first nine months of 2023 (9M 2023), total income rose 24% year on year to S$10.2 billion on the back of a 35% year-on-year jump in net interest income to S$7.2 billion.

Operating profit before allowances climbed 40% year on year to S$6.3 billion while net profit increased by 32% year on year to S$5.4 billion.

9M 2023’s net interest margin (NIM) came in at 2.28%, sharply higher than the 1.78% logged in the prior year.

Fee income also rose to its highest level in the last four quarters.

CEO Helen Wang believes that OCBC is on track for a resilient set of earnings for 2023 with return on equity targeted at 14% and NIM ending at around 2.25%.

The bank upped its interim dividend last year to S$0.40, nearly 43% higher than the S$0.28 paid out a year ago.

OCBC looks poised to continue to grow its earnings as interest rates stay higher for longer.

Last July, the bank unveiled its One Group strategy in a rebranding exercise along with a new logo and tagline.

Armed with a new ASEAN and Greater China focus, OCBC expects to accelerate its growth and deliver S$3 billion in incremental revenue by 2025, on top of its current growth trajectory.

Singapore Exchange Limited (SGX: S68)

Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.

The group operates a platform for the buying and selling of a wide range of securities such as equities, bonds, derivatives, and currencies.

SGX reported a commendable set of earnings for its fiscal 2023 ending 30 June 2023.

Revenue rose 8.7% year on year to S$1.2 billion with net profit jumping 26.5% year on year to S$570.9 million.

Excluding one-off and exceptional items, net profit would have grown by 10.3% year on year to S$503.2 million.

In line with the good results, the bourse operator also upped its quarterly dividend to S$0.085 from S$0.08.

Back in September 2023, SGX announced a new corporate structure that promises to leverage the strengths of its multi-asset offerings and position the organisation for growth across its products and platform.

The group’s aim is also to build a fully integrated and scalable platform to become Asia’s one-stop venue for international foreign exchange futures and over-the-counter participants.

In the medium term, SGX is targeting high-single-digit % revenue growth along with mid-single-digit % growth in dividend per share.

Mapletree Logistics Trust (SGX: M44U)

Mapletree Logistics Trust, or MLT, is an industrial REIT with a portfolio of 187 properties in eight countries.

The total assets under management (AUM) stood at S$13.3 billion as of 31 December 2023.

The logistics REIT released an admirable set of earnings despite facing headwinds from China and higher interest rates.

For the first nine months of fiscal 2024 (9M FY2024), MLT’s gross revenue inched up 0.2% year on year to S$552.9 million.

Net property income dipped by 0.2% year on year to S$479.6 million.

Distribution per unit, however, edged up 0.7% year on year to S$0.06792.

The REIT sported a healthy occupancy rate of close to 96% and reported a positive rental reversion of 3.8%.

There could be more growth in store for the logistics REIT.

MLT completed the acquisition of nine properties in 9M FY2024 which should add to its DPU.

In the same period, it also divested eight properties in Malaysia, Japan, and Singapore, all at a premium to valuation.

Singapore Technologies Engineering Ltd (SGX: S63)

Singapore Technologies Engineering, or STE, is an engineering and technology group serving clients in the aerospace, smart city, defence, and public security sectors.

For its 9M 2023 business update, STE reported a 12% year on year increase in revenue to S$7.3 billion.

In particular, the group’s commercial aerospace division witnessed a sharp 30% year on year increase in revenue to S$2.8 billion as air travel resumed with a vengeance.

STE clinched a total of S$11.7 billion in new contracts for 9M 2023, bringing its order book to S$27.5 billion as of 30 September 2023.

The engineering giant also invested in airframe maintenance hangars in Florida and Singapore which should help to further expand its capacity.

An interim dividend of S$0.04 was paid out for 3Q 2023, bringing annualised dividend per share to S$0.16.

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Disclosure: Royston Yang owns shares of Singapore Exchange Limited.

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