The lower that the RBA cash rate goes, the more attractive that ASX income stocks with large dividend yields become for income-seekers.
The RBA has already reduced the cash rate twice in 2025 and there are projections that there could be more cuts in the coming months.
Term deposits and savings accounts are offering savers lower returns. But, it's not as though retailers or utilities are significantly reducing the costs of their products and services for customers. ASX income stocks could be the answer because of how they can provide stronger passive income yields as well as growth of payments over time for some businesses.
There are a few high-yield names I'd normally mention in an article like this such as GQG Partners Inc (ASX: GQG) and Bailador Technology Investments Ltd (ASX: BTI). But, there are a number of other names that I believe are worth knowing about.
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Centuria Office REIT (ASX: COF)
This is a real estate investment trust (REIT) which owns a portfolio of office buildings around Australia.
The business said that at 31 March 2025 it had a portfolio occupancy of 91.4% with a weighted average lease expiry (WALE) of 4.2 years despite the challenging conditions for the office sector. Offices are priced at a lower multiple of its rental profit than other types of buildings such as warehouses, creating larger distribution yields.
Centuria Office REIT said it continues to actively address known vacancies and upcoming lease expiries across its portfolio. The business said "achieving successful leasing outcomes requires capital investment towards repurposing existing fit-outs to align with tenant expectations and undertaking refurbishments to reposition assets".
The ASX income stock expects to generate 11.8 cents per unit of rental profit (funds from operations – FFO) and pay a distribution per unit of 10.1 cents. At the current Centuria Office REIT unit price, it is expected to pay a distribution yield of 8.1% in FY25. It's trading at 10.5x its FY25 forecast rental profit.
Inghams Group Ltd (ASX: ING)
Inghams has more than 8,000 employees, it's one of Australia's largest poultry businesses. It supplies major retailers, fast food operators, food service distributors and wholesalers. The business says it has strong market positions across the Australian turkey, Australian stockfeed and the New Zealand diary feed industries.
The last two dividends paid by the business come to 19 cents per share, which translates into a grossed-up dividend yield of 7.7%, including franking credits.
The business is expecting some net benefit from lower key feed costs in FY25. It also expects to deliver annualised cost savings through procurement, operational and continuous improvement initiatives that will "significantly contribute to offsetting general inflationary effects".
In FY25, the ASX income stock is expecting to generate operating profit (EBITDA) that's between flat to 6% growth. The company expects the core poultry net selling price (NSP) to show "modest growth" in FY25, which will help offset a slight reduction in the core poultry volumes.
According to the forecasts on Commsec, the Inghams share price is trading at 11x FY26's estimated earnings with a potential grossed-up dividend yield of 10.8%, including franking credits.
