FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-08874
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TEMPLETON DRAGON FUND, INC.
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(Exact name of registrant as specified in charter)
500 EAST BROWARD BLVD., SUITE 2100, FORT LAUDERDALE, FL 33394-3091
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(Address of principal executive offices) (Zip code)
CRAIG S. TYLE, ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
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(Name and address of agent for service)
Registrant's telephone number, including area code: (954) 527-7500
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Date of fiscal year end: 12/31
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Date of reporting period: 9/30/05
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ITEM 1. SCHEDULE OF INVESTMENTS.
TEMPLETON DRAGON FUND, INC.
QUARTERLY STATEMENT OF INVESTMENTS
SEPTEMBER 30, 2005
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CONTENTS
Statement of Investments ................................................. 3
Notes to Statement of Investments ........................................ 6
[LOGO](R)
FRANKLIN TEMPLETON
INVESTMENTS
Franklin o TEMPLETON o Mutual Series
Quarterly Statement of Investments | 1
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TEMPLETON DRAGON FUND, INC.
STATEMENT OF INVESTMENTS, SEPTEMBER 30, 2005 (UNAUDITED)
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COUNTRY SHARES VALUE
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COMMON STOCKS 95.5%
AIR FREIGHT & LOGISTICS 0.1%
Sinotrans Ltd., H ......................... China 3,017,000 $ 1,059,770
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AIRLINES 0.3%
(a)Air China Ltd., H ......................... China 8,850,000 2,737,943
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AUTO COMPONENTS 1.0%
Cheng Shin Rubber Industry Co. Ltd. ....... Taiwan 10,208,938 8,321,459
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AUTOMOBILES 0.1%
Chongqing Changan Automobile Co. Ltd., B .. China 2,082,470 880,486
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CAPITAL MARKETS 0.9%
Yuanta Core Pacific Securities Co. ........ Taiwan 11,818,290 7,549,916
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COMMERCIAL BANKS 6.3%
Chinatrust Financial Holding Co. Ltd. ..... Taiwan 7,191,024 6,197,384
HSBC Holdings PLC ......................... United Kingdom 1,749,481 28,460,230
Mega Financial Holdings Co. Ltd. .......... Taiwan 27,217,000 17,223,094
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51,880,708
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COMMUNICATIONS EQUIPMENT 0.4%
D-Link Corp. .............................. Taiwan 3,277,239 3,397,177
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COMPUTERS & PERIPHERALS 5.8%
Acer Inc. ................................. Taiwan 12,965,943 25,786,932
Advantech Co. Ltd. ........................ Taiwan 2,736,514 6,844,274
Asustek Computer Inc. ..................... Taiwan 3,171,863 8,506,601
Lite-On Technology Corp. .................. Taiwan 5,891,622 6,577,710
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47,715,517
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CONSTRUCTION MATERIALS 0.2%
Anhui Conch Cement Co. Ltd., H ............ China 1,306,000 1,296,295
China Resources Cement .................... China 872,000 141,630
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1,437,925
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DISTRIBUTORS 3.0%
China Resources Enterprise Ltd. ........... China 12,628,000 20,673,219
Test-Rite International Co. Ltd. .......... Taiwan 5,227,963 4,048,716
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24,721,935
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DIVERSIFIED TELECOMMUNICATION SERVICES 0.5%
China Telecom Corp. Ltd., H ............... China 10,278,000 3,875,291
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ELECTRIC UTILITIES 4.5%
Cheung Kong Infrastructure Holdings Ltd. .. Hong Kong 11,060,000 36,925,358
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ELECTRICAL EQUIPMENT 0.4%
Phoenixtec Power Co. Ltd. ................. Taiwan 3,632,945 3,557,901
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ELECTRONIC EQUIPMENT & INSTRUMENTS 2.2%
Delta Electronics Inc. .................... Taiwan 10,439,970 17,837,498
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Quarterly Statement of Investments | 3
TEMPLETON DRAGON FUND, INC.
STATEMENT OF INVESTMENTS, SEPTEMBER 30, 2005 (UNAUDITED) (CONTINUED)
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COUNTRY SHARES VALUE
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COMMON STOCKS (CONT.)
FOOD & STAPLES RETAILING 17.7%
Dairy Farm International Holdings Ltd. .......... Hong Kong 39,843,978 $145,828,959
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FOOD PRODUCTS 0.8%
UNI-President Enterprises Corp. ................. Taiwan 16,612,030 6,682,756
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HOTELS RESTAURANTS & LEISURE 2.4%
Hong Kong & Shanghai Hotels Ltd. ................ Hong Kong 17,869,838 19,810,201
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HOUSEHOLD DURABLES 1.1%
TCL Multimedia Technology Holdings Ltd. ......... China 48,960,000 9,088,113
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INDEPENDENT POWER PRODUCERS & ENERGY TRADERS 3.5%
Datang International Power Generation Co. Ltd., H China 26,502,000 20,326,632
Guangdong Electric Power Development Co. Ltd., B China 11,270,600 5,143,043
Huadian Power International Corp. Ltd., H ....... China 7,428,000 2,058,639
Huaneng Power International Inc., H ............. China 1,454,000 1,077,710
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28,606,024
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INDUSTRIAL CONGLOMERATES 4.9%
CITIC Pacific Ltd. .............................. China 7,081,000 19,807,248
(a)LG Corp. ........................................ South Korea 355,170 8,968,596
Shanghai Industrial Holdings Ltd. ............... China 5,774,000 11,685,472
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40,461,316
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IT SERVICES 0.3%
Travelsky Technology Ltd., H .................... China 2,837,000 2,559,925
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LEISURE EQUIPMENT & PRODUCTS 0.4%
Premier Image Technology Corp. .................. Taiwan 2,363,850 3,468,970
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MACHINERY 2.0%
China International Marine Containers Co. Ltd., B China 12,791,872 12,845,215
Yung Tay Engineering Co. Ltd. ................... Taiwan 5,686,000 3,606,705
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16,451,920
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METALS & MINING 0.1%
Aluminum Corp. of China Ltd., H ................. China 1,028,000 649,321
(b)China Oriental Group Co. Ltd., 144A ............. China 422,000 100,636
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749,957
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OFFICE ELECTRONICS 0.1%
Kinpo Electronics Inc. .......................... Taiwan 1,526,700 639,470
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OIL, GAS & CONSUMABLE FUELS 10.7%
China Petroleum & Chemical Corp., H ............. China 103,150,000 47,202,761
(b)PetroChina Co. Ltd., 144A ....................... China 9,200,000 7,708,520
PetroChina Co. Ltd., H .......................... China 40,050,000 33,557,199
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88,468,480
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4 | Quarterly Statement of Investments
TEMPLETON DRAGON FUND, INC.
STATEMENT OF INVESTMENTS, SEPTEMBER 30, 2005 (UNAUDITED) (CONTINUED)
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COUNTRY SHARES VALUE
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COMMON STOCKS (CONT.)
REAL ESTATE 9.3%
Cheung Kong Holdings Ltd. ....................................... Hong Kong 2,575,000 $ 29,077,105
Hang Lung Group Ltd. ............................................ Hong Kong 16,159,042 31,140,574
Henderson Investment Ltd. ....................................... Hong Kong 7,485,000 10,661,637
Hong Kong Land Holdings Ltd. .................................... Hong Kong 1,904,000 5,978,560
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76,857,876
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SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT 4.2%
Elan Microelectronics Corp. ..................................... Taiwan 3,454,491 1,389,687
Faraday Technology Corp. ........................................ Taiwan 471,162 826,314
Samsung Electronics Co. Ltd. .................................... South Korea 10,780 6,074,403
Siliconware Precision Industries Co. Ltd. ....................... Taiwan 3,319,489 3,350,948
Sunplus Technology Co. Ltd. ..................................... Taiwan 6,575,395 6,023,474
Taiwan Semiconductor Manufacturing Co. Ltd. ..................... Taiwan 10,645,921 17,098,660
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34,763,486
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TEXTILES APPAREL & LUXURY GOODS 0.6%
Tack Fat Group International Ltd. ............................... Hong Kong 26,080,000 2,454,145
Tainan Enterprises Co. Ltd. ..................................... Taiwan 1,864,460 2,207,991
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4,662,136
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TRANSPORTATION INFRASTRUCTURE 2.6%
China Merchants Holdings (International) Co. Ltd. ............... China 3,166,874 7,103,131
Cosco Pacific Ltd. .............................................. China 5,520,000 10,744,491
Hainan Meilan International Airport Co. Ltd., H ................. Hong Kong 2,626,000 1,396,331
Hopewell Holdings Ltd. .......................................... Hong Kong 936,000 2,467,397
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21,711,350
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WIRELESS TELECOMMUNICATION SERVICES 9.1%
China Mobile (Hong Kong) Ltd., fgn. ............................. China 13,876,000 67,970,068
Taiwan Mobile Co. Ltd. .......................................... Taiwan 7,047,764 6,711,044
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74,681,112
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TOTAL COMMON STOCKS (COST $455,502,456) ......................... 787,390,935
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SHORT TERM INVESTMENTS (COST $32,425,664) 3.9%
MONEY FUND 3.9%
(c)Franklin Institutional Fiduciary Trust Money Market Portfolio ... United States 32,425,664 32,425,664
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TOTAL INVESTMENTS (COST $487,928,120) 99.4% ..................... 819,816,599
OTHER ASSETS, LESS LIABILITIES 0.6% ............................. 4,542,937
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NET ASSETS 100.0% ............................................... $824,359,536
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(a) Non-income producing.
(b) Security was purchased pursuant to Rule 144A under the Securities Act of
1933 and may be sold in transactions exempt from registration only to
qualified institutional buyers or in a public offering registered under
the Securities Act of 1933. These securities have been deemed liquid under
guidelines approved by the Fund's Board of Directors. At September 30,
2005, the value of these securities was $7,809,156, representing 0.95% of
net assets.
(c) The Franklin Institutional Fiduciary Trust Money Market Portfolio is
managed by an affiliate of the Fund's investment manager.
Quarterly Statement of Investments |
See Notes to Statement of Investments. | 5
TEMPLETON DRAGON FUND, INC.
NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)
Templeton Dragon Fund, Inc. (the Fund), is registered under the Investment
Company Act of 1940 as a closed-end, non-diversified investment company.
1. INCOME TAXES
At September 30, 2005, the cost of investments and net unrealized appreciation
(depreciation) for income tax purposes were as follows:
Cost of investments .................................. $ 488,879,819
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Unrealized appreciation .............................. $ 343,139,132
Unrealized depreciation .............................. (12,202,352)
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Net unrealized appreciation (depreciation) ........... $ 330,936,780
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For information on the Fund's policy regarding valuation of investments and
other significant accounting policies, please refer to the Fund's most recent
semiannual or annual shareholder report.
6 | Quarterly Statement of Investments
ITEM 2. CONTROLS AND PROCEDURES.
(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains
disclosure controls and procedures that are designed to ensure that information
required to be disclosed in the Registrant's filings under the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 is recorded,
processed, summarized and reported within the periods specified in the rules and
forms of the Securities and Exchange Commission. Such information is accumulated
and communicated to the Registrant's management, including its principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure. The Registrant's management,
including the principal executive officer and the principal financial officer,
recognizes that any set of controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving the desired
control objectives.
Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio
Holdings on Form N-Q, the Registrant had carried out an evaluation, under the
supervision and with the participation of the Registrant's management, including
the Registrant's principal executive officer and the Registrant's principal
financial officer, of the effectiveness of the design and operation of the
Registrant's disclosure controls and procedures. Based on such evaluation, the
Registrant's principal executive officer and principal financial officer
concluded that the Registrant's disclosure controls and procedures are
effective.
(b) CHANGES IN INTERNAL CONTROLS. There have been no significant changes
in the Registrant's internal controls or in other factors that could
significantly affect the internal controls subsequent to the date of their
evaluation in connection with the preparation of this Quarterly Schedule of
Portfolio Holdings on Form N-Q.
ITEM 3. EXHIBITS.
(a) Certifications pursuant to Section 30a-2 of the Investment Company Act of
1940 of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration,
and Galen G. Vetter, Chief Financial Officer.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
TEMPLETON DRAGON FUND, INC.
By /s/JIMMY D. GAMBILL
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Jimmy D. Gambill
Chief Executive Officer -
Finance and Administration
Date November 21, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By /s/JIMMY D. GAMBILL
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Jimmy D. Gambill
Chief Executive Officer -
Finance and Administration
Date November 21, 2005
By /s/GALEN G. VETTER
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Galen G. Vetter
Chief Financial Officer
Date November 21, 2005