This High-Yield Stock May Offer Steady Income and Upside

When it comes to the markets in Singapore where dividends are the main source of income, most investors tend to choose well-known blue-chip stocks and real estate investment trusts.

The problem is: for most investors, familiarity implies safety.

But when they do this, they often overlook those obscure and less-watched companies.

These stocks are more investment-worthy because they have higher potential for returns and lower valuations.

What Makes a Stock “Overlooked”

An overlooked stock typically receives limited analytical coverage or little mainstream financial attention. 

Despite having stable fundamentals, its share price may be stagnant.

This situation arises because the company operates in a misunderstood sector or uses an under-appreciated business model.   

Even with an attractive dividend yield, this underappreciated cohort may still fail to make headlines.

Really Overlooked or Just Ignored

That said, not every overlooked company is an undervalued gem. 

What really separates the good from the rest is the quality of its fundamentals. 

Having a solid balance sheet, healthy cash flows, and consistent dividend payout are essential. 

It also helps if the business operates in a non-cyclical industry or has diversified streams of revenue. 

Even better if the stock trades at an attractive valuation relative to its peers or its own historical performance. 

A Hidden Gem

I’m sure you have heard of Chang Beer, Oishi Green Tea, or 100PLUS.

These familiar brands fall under Southeast Asia’s largest beverage player Thai Beverage Public Company Limited (SGX: Y92). 

ThaiBev’s total revenue slipped 2.1% year-on-year (YoY) for the fiscal year ended 30 September 2025 (FY2025), to THB333.3 billion.

The top-line decline may not impress, but this is a business built for stability.

This characteristic can be seen in the financial figures. 

Net profit attributable to shareholders came in at THB25.4 billion while free cash flow soared from THB 29.2 billion a year ago to THB 33 billion.

Debt has ticked up slightly, with net debt to EBITDA increasing to 3.33x.

Net debt to equity ratio came in at 1.09x. 

In simple terms, leverage was elevated but remains reasonably capitalised and not overstretched. 

More importantly, operating cash flow continues to comfortably cover debt servicing requirements. 

The company also declared a dividend of 0.62 baht (approximately S$0.025) per share, translating to a dividend payout ratio of 61%. 

Based on the stock’s price after market on 26 December 2025, this works out to a dividend yield of around 5.6%. 

Such yield is above the Strait Times Index’s (SGX: ^STI) average. 

Despite that, ThaiBev is not exactly a popular stock.

As a diversified consumer-staples company rather than flashy tech or growth names, it lacks excitement. 

But that is precisely the point.

You are not buying ThaiBev for excitement. 

Instead, you are buying it for steady income and the possibility that the market may eventually give the credit it deserves. 

Risks and What Could Go Wrong

Like every other stock, ThaiBev is not without risks. 

As an alcohol producer, the company remains exposed to regulatory changes that could affect volume or margins. 

These include potential sales restrictions, tax adjustments, or tighter advertising rules. 

In addition, competition for beer and non-alcoholic drinks production is intense, and input cost pressures can squeeze profitability, making consumer demand cycles an important factor. 

Liquidity is another consideration. 

Lower trading volumes may result in wider bid-ask spread, making it harder to exit positions quickly during times of market stress.

Dividend sustainability may currently be well supported by cash flows, but it ultimately depends on the sustainability of its business.  

Any prolonged slowdown in consumption or unexpected cost increase may put pressure on payouts. 

How to Approach This Stock (and Others Like It)

ThaiBev Company, as a core dividend stock, performed the best. At the same time, it can also be held together with other stable dividend stocks from different industries.

The idea here is to focus on long-term revenue growth rather than short-term price fluctuations.

As always, it is still necessary to closely monitor the fundamentals and industry trends.

Because this business is relatively stable, it usually does not require frequent checks.

An annual review of inventory once or twice is usually sufficient.