If there’s one trend I look for when digging up dividend gems, it’s the trend of rising dividends.
Growing dividends per share and a prudent payout ratio are two of the most basic criteria when it comes to picking dividend stocks that can perpetually grow your retirement payouts in a sustainable manner.
And the good news? There are plenty of great growing dividend players on the Malaysia exchange.
Here are easily 10 dividend players that have a track record of growing their dividends over the span of few years.
1. IHH Healthcare Berhad (KLSE: IHH)
IHH Healthcare Berhad is a leading international private healthcare group. Headquartered in Kuala Lumpur, Malaysia, it is one of the largest healthcare providers in the world by market capitalisation.
The company’s portfolio of trusted healthcare brands includes Acibadem, Mount Elizabeth, Gleneagles, Fortis, Pantai, Prince Court, and Parkway, a brand that Singaporeans are very fond of.
IHH’s dividend per share has been growing steadily over the past few years, backed by growing top line and bottom line and this trend is primarily supported by its strong and consistent financial performance.
IHH has been actively expanding its network through both organic growth and strategic acquisitions. This includes adding new hospital beds, building new facilities, and acquiring other healthcare providers. These expansions, such as the acquisition of Prince Court Medical Centre in Malaysia, Island Hospital in Penang, and facilities in Turkey and India, have increased patient footfall, diversified revenue streams, and improved overall profitability.
And with healthcare being a necessity rather than a luxury as the aging population increases, there is no doubt that the prospect for IHH remains bright.
2. Hong Leong Bank Berhad (KLSE: HLBANK)
Hong Leong Bank Berhad is a prominent financial institution in Malaysia and a member of the Hong Leong Group. Established in 1905, it has a long-standing history.
The consistent growth in Hong Leong Bank’s dividends per share is a direct result of its strong and improving financial performance, underpinned by strategic business execution.
The bank has seen commendable growth in its gross loans and financing portfolio. This is driven by strong performance in key segments like mortgages, auto loans, and financing to small and medium-sized enterprises (SMEs). By expanding its lending business, HLB increases its interest income, which is a key component of its overall revenue.
Dividends per share have grown impressively, from RM0.50 until RM0.96, which is a terrific 100% growth.
3. RHB Bank Berhad (KLSE: RHB)
RHB Bank Berhad is one of Malaysia’s leading financial services providers. As the fourth-largest fully integrated financial services group in Malaysia, it has a long history and a strong presence in both conventional and Islamic banking. It offers a comprehensive range of products and services, including retail banking, commercial banking, investment banking, and Islamic banking through RHB Islamic Bank. The group has a regional presence, with operations in ASEAN countries such as Singapore, Brunei, Cambodia, Laos, and Thailand.
In a rather competitive banking scene in Malaysia, this relatively smaller bank proves that it has the prowess to challenge status quo, going against the likes of Malayan Banking Berhad (KLSE: MBB) and CIMB Group Holdings Berhad (KLSE: CIMB). Net profit has been surging and growing from a diverse range of income streams, including both net fund-based income (interest from loans) and non-fund-based income (fees, trading, and investment income).
That helps drive the dividend per share growth, as the bank has set aside a prudent payout ratio, giving it a resilient and long growth pathway.
4. Hong Leong Financial Group Berhad (KLSE: HLFG)
We have mentioned Hong Leong Bank above. Hong Leong Financial Group is the holding group company of HLB. HLFG is the diversified sprawling financial conglomerate that also has Hong Leong Assurance Holdings and Hong Leong Capital arm.
All three arms have grown well, which has also led to robust dividend per share growth. HLFG’s dividend over the past 5 years have grown by a CAGR of +15.83%.
And if Southeast Asia’s economy continues to stay vibrant, this growth spurt definitely has more legs.
5. PPB Group Bhd (KLSE: PPB)
PPB Group Berhad is a diversified Malaysian conglomerate with a long history stretching back to 1968. It is primarily an investment holding and property investment company, with its business operations spanning a wide range of industries. The group’s principal business segments include grains and agribusiness, Film Exhibition (under the Golden Screen Cinemas brand), distribution, property, and a significant investment in Wilmar International Limited (SGX: F34).
All of its business segments are firing on all cylinders, especially the film exhibition and distribution segment.
All of this has contributed to its growing DPS.
6. Dialog Group Berhad (KLSE: DIALOG)
Dialog has evolved from an engineering and construction service provider to a key player in the entire energy value chain. Its diverse range of services spans upstream, midstream, and downstream segments, including engineering, procurement, construction, and commissioning (EPCC), plant maintenance, and specialist products. A core component of Dialog’s strategy is its ownership and operation of strategic midstream assets, most notably its Pengerang Deepwater Terminals (PDT), which provide crucial storage and handling facilities for petroleum and petrochemical products.
While its latest FY dividends per share dipped slightly, this should not be a huge concern, as the company had a one-off impairment charge taken on investments in the petrochemical and renewable energy sectors. The company made a strategic decision to exit or scale back certain projects that were no longer financially viable.
The company still charted a ridiculous free cash flow margin of 31.2% in its latest FY. So barring any unforeseen circumstances, Dialog is expected to resume or increase its dividends per share moving forward if the fundamentals remain intact.
7. Gas Malaysia Berhad (KLSE: GASMSIA)
Gas Malaysia Berhad is the sole natural gas distributor and a leading energy solutions provider in Peninsular Malaysia.
The company’s core business involves the selling, marketing, and distribution of natural gas through its extensive Natural Gas Distribution System (NGDS) to industrial, commercial, and residential customers. Gas Malaysia operates under a regulated framework, which includes a gas cost pass-through (GCPT) mechanism that helps to manage the fluctuating cost of gas and maintain a stable operating environment.
This regulated business model, with its long-term concessions and steady demand from various sectors of the economy, provides a highly predictable and reliable revenue stream.
Due to the Incentive-Based Regulation (IBR) and a gas cost pass-through (GCPT) mechanism, this framework provides the company with a guaranteed return on its regulated assets, insulating the company’s profitability from the volatile swings in natural gas prices.
This will then help ensure a stable yet growing dividend per share payout year on year.
8. Hong Leong Industries Berhad (KLSE: HLIND)
Hong Leong Industries Berhad (HLIND) is a diversified investment holding company and yet another key member of the Hong Leong Group. Its business is centred on two main operational segments: consumer products and industrial products.
The consumer products division is a major player in the Malaysian market, primarily involved in the manufacturing, assembly, and distribution of motorcycles, particularly the popular Yamaha brand, as well as ceramic tiles under the “Guocera” brand. The industrial products division is focused on the manufacturing and sale of fiber cement products and concrete roofing materials.
Motorcycles remain a key mode of transportation for Malaysians. And having the license and distributorship of Yamaha motors, on top of the rising gig economy trend, will help propel the company’s prospects more.
And that in turn, drives up the dividends per share trend.
9. Aeon Credit Service (M) Bhd (KLSE: AEONCR)
AEON Credit Service (M) Berhad is a leading consumer financing provider in Malaysia. As a subsidiary of the Japanese-based Aeon Financial Service Co Ltd (TYO: 8570), AEON Credit’s business model is centred on providing a wide range of financial services, including easy payment schemes for consumer goods (such as furniture and electrical appliances), personal financing based on Shariah principles, and the issuance of payment cards under international brands like Visa and MasterCard.
The company’s unique advantage lies in its synergy with the broader AEON Group’s retail ecosystem, which includes shopping malls and supermarkets. This integration allows it to cross-sell financial products and tap into a large customer base. The company is also a strong player when it comes to motorcycle financing as well, commanding a market share of more than 20%.
And with now another digital banking frontier in the making, there is definitely more untapped potential for this nimble yet agile financing service provider.
10. Kotra Industries Berhad (KLSE: KOTRA)
Kotra Industries Berhad is a key player in Malaysia’s pharmaceutical and healthcare industry. As an integrated pharmaceutical company, it is involved in the development, manufacturing, and distribution of a wide range of pharmaceutical and healthcare products. The company’s portfolio is diverse, spanning ethical pharmaceuticals (prescription-only drugs) under the Axcel and Vaxcel brands, as well as over-the-counter (OTC) products and nutraceuticals (health supplements) under its well-known Appeton brand.
Kotra has took time to build up trust and loyalty in the Malaysian market throughout the years. As pharmaceutical and healthcare related supplements are usually dominated by Western companies, Kotra took time and effort to craft its niche and offerings. The pharmaceutical industry is notoriously competitive, but Kotra has not only managed to hold the fort in its key areas, but has also expanded into plenty of other offerings.
Kotra’s high margin and growing profits have thus directly translated into better dividends per share along the years.
Verdict
I may be biased – I think the robustness and resilience of the Singapore banks trumps plenty of the Malaysian dividend paying counters. But to be frank, some of the companies mentioned above have managed to grow their dividends per share at a much faster pace than the Singapore banks.
Yes, the trade-off will be from the size of the companies. Many of the companies, if not all, are smaller, and thus, appear less sturdy when compared against the likes of Singapore’s Terrific Trio.
But if stablilty is the ultimate verdict, then bonds will make up most of my portfolio. The fact that I chose equities, means that while stability is important for a dividend paying company, it should not come at the cost of ignoring other much more prospective dividend paying companies with solid track record.
Which of the mentioned 10 companies are your favourite blue-chip dividend company in the making?
Chris shares how he picks the best dividend stocks for his early retirement portfolio that helped him retire at 39. Discover how with him live.
