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Hey there, fellow dividend investors!

We’ve all seen how the Straits Times Index or STI has been breaking records this year, climbing to levels we haven’t seen in a long time. No one calls it the “Super Terrible Index” anymore! Alongside the STI, many of Singapore’s blue chip dividend shares also surged to their own record highs.

But here’s the twist. While investors were basking in joy, a few of these key stocks have suddenly declined substantially from their highs. Share prices that looked unstoppable just months ago are now struggling, leaving anxious investors wondering: was that the peak, or are these just catching their breath before the next leg up?

In this post, I’ll walk through three familiar Singapore blue chips that have each declined meaningfully after strong rallies. We’ll look at what drove their share prices up, why they’ve fallen back, and the lessons dividend investors can take away. And at the end, I’ll share my personal view on what I might do in such tough situations.

But before we dive in, let me remind you that this post is for informational purposes only and not financial advice. Always do your own research and consult a licensed financial adviser before making any investment decisions. I own some of the shares discussed, but what works for me might not work for you.

Alright, let’s get started.

Singapore Airlines: Strong Core, Messy Associates

Singapore Airlines is our flag carrier, flying passengers to and from 129 destinations worldwide. It’s also one of Singapore’s most recognisable blue chips, and in recent years it has rewarded investors with healthy dividends and a strong post-pandemic recovery.

Earlier this year, the stock climbed to $7.60, and on a 5-year basis SIA has surged over 80%. It was boosted by robust passenger volumes, full flights, and cheaper fuel. 

Scoot was operating at nearly 92% load factors, and the core airline delivered operating profit up 42% quarter-on-quarter. Even the cargo arm benefitted temporarily from frontloading ahead of US tariffs. A weaker US dollar helped too, cutting costs since two-thirds of expenses are US dollar-denominated.

But the SIA group results told a different story. Net profit plunged nearly 60% year-on-year to $186 million — not because of its Singapore operations, but because of Air India. 

Following the merger of Vistara, SIA now has to consolidate Air India’s results. And Air India had a tough quarter: compensation provisions after a 787 crash, a temporary 15% cut to wide-body flights, and weaker yields. Some analysts now project SIA’s 2QFY2026 net profit could fall nearly 50% year-on-year to just $150 million, once Air India and lower interest income are accounted for.

On top of that, passenger yields slipped nearly 3% as more capacity came into the market, while interest income fell by $61 million as cash balances shrank and rates declined.

Valuation added to the pain. At $7.60, SIA was trading at around 1.45 times book value — close to three standard deviations above its historical mean since 2011. That was “priced for perfection.” When earnings disappointed, the share price fell back toward $6.50, flat for the year.

My quick take on this? I think we have to remember that even when core operations are strong, associates can create major earnings noise. And when a stock is priced at a premium, the market can be unforgiving. 

The core airline is resilient, but Air India’s losses make earnings noisy. For me, if I’m already holding it, I would hold and collect dividends. But as I’m currently not invested in SIA, I personally wouldn’t add until there’s more clarity on the impact from Air India.

Sembcorp Industries: From Market Darling to Sudden Sell-Off

Sembcorp Industries is a leading energy and utilities company, with operations spanning power, gas, and renewables. In recent years, it has reinvented itself as a renewable energy leader, now managing nearly 19 gigawatts of capacity worldwide. In Singapore, it operates 3 gigawatts of power and is behind major floating solar projects at Tengeh, Kranji, and Pandan Reservoir.

Investors loved this green transition story, especially after the disposal of loss-making SembCorp Marine. From $5.50 at the start of the year, the stock surged more than 40% to nearly $7.85 by early August. Analysts cheered its free cash flow of $1.3 billion, its solid balance sheet with most debt fixed and long-term, and a dividend payout of 23 cents a year, translating to a 3% to 4% yield.

But the half-year results on 8 August brought the rally to a halt. Net profit came in at $491 million, basically flat year-on-year. Revenue fell 8% to $2.9 billion. And forex swings hit hard: the stronger Singapore dollar against the rupee led to nearly $120 million of losses. Margins in China renewables were squeezed by tariffs and curtailment, while gas and related services delivered weaker-than-expected results.

For a stock trading well above its long-term P.E. average, this was enough to spark panic. On 8 August alone, the share price crashed 14%, wiping out nearly $2 billion in market value. Within ten days, it had slid to $6. Four analyst downgrades didn’t help sentiment.

Yet, the business fundamentals are still there. Renewables capacity continues to grow, with new projects coming online. Singapore awarded it an 85MW floating solar farm at Pandan Reservoir in September. Urban solutions in Vietnam and Indonesia are contributing through land sales. And securitisation of Indian renewable assets could unlock capital for further growth.

My quick take on this? The correction here wasn’t about a broken business. It was about expectations running too far, too fast. I think SembCorp is still a strong long-term renewables play. After the decline, with the hype and high valuations coming off a little, I’m more attracted to it. But I don’t expect major fireworks like the past couple of years, but more steady progress, like how a true blue-chip stock should behave. 

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SingPost: Waiting for a Reset, but Investors Aren’t Waiting

Singapore Post is best known for its postal and logistics business, though property income from SingPost Centre is now a crucial contributor. Over the years, it has sold non-core assets, including its Australian logistics unit and even post office shophouses, and used proceeds to pay special dividends.

At the start of 2025, the stock was around 53 cents. By July, it climbed to 65 cents, riding on the 9-cent special dividend and hopes of more monetisation. But since then, it has plunged to just 43 cents — down nearly 20% year-to-date.

The biggest trigger came just recently in September, when Alibaba, once a strategic partner and the second-largest shareholder, slashed its stake from 11% to below 5%. That raised fears of further selldowns, since Alibaba no longer needs to disclose transactions. At the same time, Singtel — the largest shareholder with 22% — has been monetising assets across its portfolio, fuelling speculation it could eventually reduce its SingPost stake.

Meanwhile, the company is in transition. It’s still searching for a new CEO, and a new strategy is expected only after that. In the meantime, operations are weak. First-quarter operating profit plunged 60% to just $3.4 million, as revenue fell almost 24%. Domestic deliveries dropped 10%, while international deliveries collapsed nearly 60% due to competition. The only steady leg is property income, with SingPost Centre fully leased.

Management argues the divestments have streamlined the business, but with asset monetisation largely done, there are few catalysts left. Some analysts have slashed target prices. 

My quick take on SingPost is that it is still in the process of searching for direction. That leaves investors in a real dilemma — sentiment isn’t one-way. On one hand, Alibaba has been cutting its stake and creating an overhang. But on the other hand, DBS recently bought 250,000 shares for about $110,000, which further lifts Temasek’s deemed interest in SingPost. It’s a reminder that while some big shareholders are heading for the exit, others are quietly adding exposure.

To me, there are too many uncertainties — shrinking core business, shareholder overhangs, and no clear growth plan. For now, it’s better to wait and watch, or focus on cleaner dividend names. 

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The Dividend Uncle’s Take

When you look at these three stocks side by side, you see a clear pattern. Each stock climbed to new highs alongside the STI’s rally this year, but after peaking, each has faced its own reality check. For SIA, it’s the heavy baggage of Air India. For Sembcorp, it’s expectations running ahead of reality. And for SingPost, it’s a company still in search of direction.

The bigger lesson for me as an investor? Even blue chips can stumble after big runs. As dividend investors, we can’t just chase yields or big names on the way up. We need to ask: is the business model sustainable, are dividends dependable, and is valuation reasonable? If those boxes aren’t ticked, then even household names can deliver more headaches than income.

So there you have it — three blue chips, three substantial declines from their peaks, and three lessons. SIA shows us the risks of noisy associates. Sembcorp reminds us how expectations can overshoot reality. And SingPost highlights the dangers of transition without clarity.

If you found this post useful, do give it a like, drop a comment to share your thoughts, and subscribe for more steady, thoughtful takes on dividend investing. Until next time — this is The Dividend Uncle, reminding you: invest steady, live steady.