Outside the familiar blue-chip waters lies the small-cap space – companies with market capitalisations below S$1 billion – where select names offer yields that rival that of their larger peers. 

Today, we’ll explore three of these dividend stocks.

SBS Transit

SBS Transit is the largest bus operator in Singapore, operating three major railway lines (the Northeast Line, the Central Line, and the Sentonggoh-Pongor Light Rail Line), and also generating revenue through commercial activities such as advertising and facility leasing.

As of the close of the stock market last Friday, its market value had reached S$1 billion.

The results for the first half of 2025 (1H2025) were mixed.

Revenue declined 4.5% year on year (YoY) to S$745.9 million, while profit attributable to shareholders fell 7.7% to S$31.1 million. 

The primary culprit? 

The loss of the Jurong West bus package in August 2024, which reduced bus mileage. 

However, the transport operator demonstrated resilient cash generation, posting S$29.1 million in free cash flow versus a negative S$23.8 million a year earlier, a remarkable turnaround that bodes well for dividend sustainability.

SBS Transit’s financial position should catch the eyes of income investors – S$340.8 million in cash with zero debt as of 30 June 2025. 

This enabled management to increase the interim dividend by 60% to S$0.0895 per share, signaling confidence in future cash flows despite operational challenges.

Looking ahead, the outlook is nuanced. 

Railway operations are expected to benefit from the continuous growth in passenger numbers and the scheduled fare increase in December 2025. However, their bus operations are facing ongoing pressure as they lost the bus franchise in Tanpaz in July 2026, which was acquired by the Singapore-based Go-Ahead company.

Despite the challenges brought by the increase in labor costs, the management expects that fuel and energy costs will decrease, thereby providing the company with some profit margins to alleviate the pressure.

For those retirees seeking stable passive income, SBS Transport Company offers reliable public service guarantees supported by government contracts, a debt-free balance sheet, and a management team willing to return profits to shareholders when cash flow improves.

Old Chang Kee

A household name in Singapore, famed for their curry puffs and fried snacks, Old Chang Kee operates 80 retail outlets. 

With a market capitalisation of S$136 million, this modest-sized operator punches above its weight in profitability.

The fiscal year ended 31 March 2025 (FY2025) showcased the company’s operational efficiency. 

While revenue grew modestly by 1% to S$102.0 million, boosted by new outlets and expanded catering channels, net profit surged 17% to S$11.3 million. 

Gross margin expansion improved to 69.2% from 67.6% a year earlier, stemming from better food cost management, strategic pricing, and lower utilities and production staff costs, which demonstrated Old Chang Kee’s ability to protect profitability despite a challenging operating environment.

The company’s financial foundation remains solid, with S$58.5 million in cash and deposits against minimal debt of just S$1.7 million as of 31 March 2025. 

Free cash flow generation remained healthy at S$23.2 million, though down 7% YoY, due to working capital movements and modest capital investments.

Supported by strong cash generation and a conservative balance sheet, the board maintained a total dividend at S$0.02 per share for FY2025, consisting of an interim and proposed final dividend of S$0.01 each. 

Nevertheless, Old Chang Kee faces inflationary headwinds, particularly rising raw materials and labour costs compounded by Singapore’s tight manpower market, which it plans to counter through continued cost optimization, margin improvement initiatives, and streamlining operations.

Strategic expansion at high-traffic locations like transport hubs should support revenue diversification beyond traditional retail outlets.

For income-seeking retirees, Old Chang Kee offers exposure to a resilient consumer staple business with proven pricing power and margin management capabilities.

VICOM Ltd

VICOM holds a market share of up to 72% in the vehicle inspection sector in Singapore. The mandatory vehicle inspections it provides comply with safety and environmental standards, and it also offers non-destructive testing, mechanical testing and calibration services for the manufacturing and construction industries.

The market value of Vikom Company is S$564 million. The industry it is in has clear regulatory constraints and an extremely high entry threshold, so its development is relatively stable.

1H2025 saw impressive results: revenue surged 24.1% YoY to S$69.9 million, propelled by the Electronic Road Pricing 2.0 On-Board Unit (OBU) installation project and stronger testing volumes from manufacturing and construction sectors. 

Profit attributable to shareholders grew 10.2% to S$15.6 million, demonstrating solid operational leverage despite the substantial revenue expansion.

Free cash flow declined to S$6.0 million (from S$10.0 million a year earlier) due to S$13.3 million in capital expenditure, primarily for its new Jalan Papan integrated testing centre scheduled to open in early 2026 and aimed to enhance capacity and efficiency for years to come.

Meanwhile, VICOM’s balance sheet remains fortress-like with S$55.6 million in cash and zero debt as of 30 June 2025.

With that, shareholders were rewarded with an interim dividend of S$0.031 per share, marking a 10.7% increase from the S$0.028 paid a year ago, reflecting management’s confidence in the company’s earnings trajectory.

As the installation of ERP 2.0 OBU continues, the expected demand it brings is expected to continuously drive performance growth until the second half of 2025.

However, the possible tariff measures implemented by the United States may bring uncertainty to Singapore's manufacturing industry, which may suppress the demand for non-automotive inspection services.

For retirement investment portfolios, VICOM possesses an extremely rare comprehensive advantage: strong regulatory barriers, significant market dominance, and a continuously growing model driven by infrastructure, while its stable balance sheet also provides strong support for sustainable dividend growth.