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Asia's Highest-Yielding Dividend Stocks to Consider in April 2025

Marcus LeeSunday, Apr 20, 2025 7:21 pm ET

133min read

Investors seeking steady income in 2025 may find fertile ground in Asia, where a mix of undervalued stocks and robust corporate fundamentals are fueling dividend yields far above global averages. With many companies trading below their estimated fair value and offering payouts that often exceed 5%, Asia’s dividend landscape stands out in an era of market volatility. Below are the top stocks to consider, along with key metrics and risks to guide your decisions.

The Top Picks

1. Lion Rock Group (SEHK:1127) – 7.6% Yield

Lion Rock leads Asian dividend stocks with a 7.6% yield, among the highest in Hong Kong. Its low payout ratio of 25.7% (earnings) and 38.7% (cash) suggests strong financial health, with net income surging to HK$214.41 million in 2024. However, its dividend history is volatile, with inconsistent payouts over the past decade.

Despite this volatility, the stock trades at a 38% discount to its estimated fair value, making it a compelling entry point for risk-tolerant investors.

2. Epoch Chemtronics Corp. (TPEX:3633) – 5.6% Yield

Epoch Chemtronics, a Taiwanese manufacturer of optical instruments and electronic components, offers a 5.6% yield, well-supported by a 65.8% earnings coverage ratio. However, its dividend history is spotty, and outdated financial data raises caution.

While undervalued at 38% below fair value, this stock requires close monitoring of updated financial reports before committing capital.

3. Totech (TSE:9960) – 4.22% Yield

Totech, a Japanese environment control equipment firm, delivers a 4.22% yield with rock-solid fundamentals. Its low payout ratios (30.3% earnings, 31.7% cash) and consistent dividend history make it a reliable income generator.

Trading at a significant discount to fair value, Totech balances moderate yield with stability, ideal for conservative investors.

4. People’s Insurance Company (SEHK:1339) – 5.8% Yield

This Chinese insurer offers a 5.8% yield, bolstered by strong cash flows (cash payout ratio: 12.4%). However, its 2024 dividend dropped to RMB 0.117/share, and earnings forecasts predict a 3.3% annual decline over three years.

Investors should weigh its high yield against macro risks like China’s slowing growth and regulatory pressures.

5. Chongqing Department Store (SHSE:600729) – 4.1% Yield

This Chinese retail giant trades at 47.7% cash coverage of dividends, offering a 4.1% yield. While its dividend history is unstable, its undervaluation relative to peers and steady cash flows make it a solid long-term bet.

Key Considerations for Dividend Investors

Yield vs. Sustainability: High yields like Lion Rock’s 7.6% come with risks. Always check payout ratios and cash flow coverage.
Valuation Discounts: Many top stocks trade below fair value, but avoid overleveraged firms like Fujian Funeng (3.3% yield, high debt).
Regional Advantages: Asian markets like Hong Kong and Singapore impose zero dividend withholding taxes, boosting after-tax returns.
Macro Risks: Trade tensions and inflation could disrupt sectors like manufacturing (Epoch) and insurance (People’s Insurance).

The Data Behind Asia’s Dividend Edge

The Solactive Asia Pacific High Dividend Yield Index historically offered 8.0% yields, nearly double the 3.2% average of the Hang Seng Index. This gap reflects Asia’s lower debt levels, tax efficiency, and strong corporate cash flows.

Conclusion

Asia’s dividend landscape in April 2025 offers compelling opportunities for income-focused investors, provided they prioritize sustainability over yield alone. Lion Rock Group (SEHK:1127) stands out for its high yield and valuation discount, while Totech (TSE:9960) delivers stability at a reasonable price.

For balanced risk and reward, consider Epoch Chemtronics (TPEX:3633) or Chongqing Department Store (SHSE:600729), but proceed with caution given their volatile histories. Avoid overvalued stocks and those with payout ratios exceeding 70%, as seen in companies like DeHua TB (5.3% yield, 93.3% payout).

In this era of market uncertainty, Asia’s dividend stocks provide a rare mix of income potential and undervalued pricing. But remember: the highest yields often come with the highest risks.

This analysis draws from Simply Wall St’s dividend screener, which evaluates 1,256 Asian stocks. Always cross-reference with updated financial data before investing.

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