In 2024, dividends in the Asia Pacific ex-Japan region experienced a slight decline of 4.2%, contrasting with the global trend of reaching record highs in dividend payouts. The latest Janus Henderson Global Dividend index revealed that the Apac region saw a 2% fall on an underlying basis, but reduced special dividends and weaker exchange rates contributed to the headline figure’s 4.2% decline.
On a global scale, dividends grew by 6.6% on an underlying basis, primarily fueled by strong growth in the financial sector and the introduction of maiden dividends from tech giants Meta and Alphabet. However, Japanese dividend growth stood out as the strongest among major stock markets for the second consecutive year, with a remarkable 15.5% increase in dividend payouts on an underlying basis.
Japanese companies demonstrated robust dividend practices, with 94% of them either raising or maintaining dividends throughout the year, surpassing the global average. Notably, Toyota Motor and Honda made significant contributions, accounting for a quarter of the $12 billion constant currency increase in total dividends.
In China, there was a notable surge in dividend payouts, with a remarkable 17.8% increase on an underlying basis in 2024, reaching a record $62.7 billion. This growth was largely driven by substantial payouts from Alibaba, which distributed $5.1 billion during the year, instantly becoming China’s third-largest dividend payer.
However, Australia’s dividend payouts weighed on the overall Apac region, experiencing a 6.4% drop impacted by significant cuts from companies like Woodside, BHP, and ANZ. Despite this setback, there is optimism for the future of dividends in the region.
Sat Duhra, portfolio manager for Asia dividend income at Janus Henderson, expressed confidence in the long-term positive trend of dividends in Asia. He highlighted that Asian corporates tend to be more conservative amidst global growth concerns but expects dividends to continue on a positive trajectory following recent developments in tariffs and stabilization in China.
Moreover, Duhra pointed out that compelling corporate reform initiatives in China and South Korea, where regulators are encouraging higher dividends, could further support the long-term thesis of dividend growth in Asia. This trend is expected to persist for years to come, signaling a promising outlook for dividend investors in the region.
In conclusion, the dynamics of dividend payouts in the Asia Pacific ex-Japan region reflect a mix of challenges and opportunities, with Japan and China showcasing strong growth while Australia faces some setbacks. Despite fluctuations, the overall trend suggests a positive trajectory for dividends in Asia, driven by corporate reforms and regulatory initiatives aimed at fostering dividend growth.
