-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, L8FDpttNgBOVbo3kSvqbFqypiU34ztOkauWKHkrB8d3MelIxQDEEm8p3LWszyv2P krQu4UoBxFR++MyeqYul+w== 0000912057-95-010846.txt : 19951208 0000912057-95-010846.hdr.sgml : 19951208 ACCESSION NUMBER: 0000912057-95-010846 CONFORMED SUBMISSION TYPE: N-30B-2 PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951207 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MORGAN STANLEY ASIA PACIFIC FUND INC CENTRAL INDEX KEY: 0000919808 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: N-30B-2 SEC ACT: 1940 Act SEC FILE NUMBER: 811-08388 FILM NUMBER: 95599950 BUSINESS ADDRESS: STREET 1: 73 TREMONT STREET 8TH FLOOR CITY: BOSTON STATE: MA ZIP: 02108 BUSINESS PHONE: 6175578790 MAIL ADDRESS: STREET 1: MORGAN STANLEY ASIA PACIFIC FUND STREET 2: 73 TREMONT STREET 8TH FLOOR CITY: BOSTON STATE: MA ZIP: 02108 FORMER COMPANY: FORMER CONFORMED NAME: MORGAN STANLEY ASIA INVESTMENT FUND INC DATE OF NAME CHANGE: 19940316 N-30B-2 1 THIRD QTR RPT MORGAN STANLEY ASIA-PACIFIC FUND, INC. - --------------------------------------------- OFFICERS AND DIRECTORS Barton M. Biggs William G. Morton, Jr. CHAIRMAN OF THE BOARD DIRECTOR OF DIRECTORS Frederick B. Whittemore Warren J. Olsen DIRECTOR PRESIDENT AND DIRECTOR James W. Grisham Peter J. Chase VICE PRESIDENT DIRECTOR Harold J. Schaaff, Jr. John W. Croghan VICE PRESIDENT DIRECTOR Joseph P. Stadler David B. Gill VICE PRESIDENT DIRECTOR Valerie Y. Lewis Graham E. Jones SECRETARY DIRECTOR James R. Rooney John A. Levin TREASURER DIRECTOR Joanna M. Haigney ASSISTANT TREASURER
- --------------------------------------------- INVESTMENT ADVISER Morgan Stanley Asset Management Inc. 1221 Avenue of the Americas New York, New York 10020 - -------------------------------------------------------- ADMINISTRATOR The Chase Manhattan Bank, N.A. 73 Tremont Street Boston, Massachusetts 02108 - -------------------------------------------------------- CUSTODIANS Morgan Stanley Trust Company (International) One Pierrepont Plaza Brooklyn, New York 11201 The Chase Manhattan Bank, N.A. (Domestic) 770 Broadway New York, New York 10003 - -------------------------------------------------------- SHAREHOLDER SERVICING AGENT American Stock Transfer & Trust Company 40 Wall Street New York, New York 10005 (800) 278-4353 - -------------------------------------------------------- LEGAL COUNSEL Rogers & Wells 200 Park Avenue New York, New York 10166 - -------------------------------------------------------- INDEPENDENT ACCOUNTANTS Price Waterhouse LLP 1177 Avenue of the Americas New York, New York 10036 - -------------------------------------------------------- For additional Fund information, including the Fund's net asset value per share and information regarding the investments comprising the Fund's portfolio, please call 1-800-221-6726. ------------------------ MORGAN STANLEY ASIA-PACIFIC FUND, INC. --------------------- THIRD QUARTER REPORT SEPTEMBER 30, 1995 MORGAN STANLEY ASSET MANAGEMENT INC. INVESTMENT ADVISER LETTER TO SHAREHOLDERS - ------- For the third quarter and the nine months ended September 30, 1995, the Morgan Stanley Asia-Pacific Fund, Inc. had a total return, based on net asset value per share (assuming reinvestment of dividend distributions), of 3.13% and 3.76%, respectively compared to its benchmark (as defined below) of 3.32% and -1.79%, respectively. (The benchmark for investment performance is the weighted average of the percentage change month-on-month of each of four Morgan Stanley Capital International (MSCI) indices; Japan, Combined Asia Free ex-Japan, Australia, and New Zealand, where the weights are based on the respective market capitalizations of these indices at the beginning of the month.) JAPAN The critical state of Japan's fragile economy was highlighted during the third quarter, and the need to address Japan's recovery in a meaningful way was the subject of much attention. To this end, the central banks of Japan, the U.S. and Germany intervened in world currency markets, coordinating their efforts to deliberately weaken the yen over the quarter from 84 to 98 yen per dollar. In addition to lending support to the central bank's weak yen policy, Japanese authorities officially recognized the sluggish state of affairs by implementing measures to stimulate the economy. In particular, Mr. Takemura facilitated foreign investments in August by easing the regulations on the capital outflows of local life insurance companies. In September, further measures were undertaken to stimulate the economy, including cutting the Official Discount Rate to a historic low of 0.5% and announcing a Y14 trillion spending program. As a result of these dramatic and unprecedented measures to jump-start the economy, foreign investors took an aggressive and positive stance on Japan, evidenced by heavy purchasing of Japanese equities. Foreigners continued to buy Japanese equities in spite of the bankruptcies of two credit unions, suggesting that foreign investors were confident that the Japanese authorities would adequately and effectively address the non-performing loan problem plaguing Japanese banks. As a consequence, the market managed to return in excess of 20% in yen terms (4.3% in U.S. dollar terms), notwithstanding the fact that Japanese investors were largely sellers during the third quarter. Sectors relating to semiconductors and other high-tech names registered substantial gains, owing to the upward earnings revisions by these companies. The Fund increased its exposure to Japanese equities during the quarter, redeploying money raised in Malaysia. ASIA EX-JAPAN Asian markets were exceptionally quiet during the third quarter of 1995 for two basic reasons. First, foreign institutional investors opted for the sidelines, focusing instead on Japanese and U.S. equity markets. They also shied away given the sensitivity of Asian markets to movements in U.S. interest rates, the direction of which remained unclear for much of the quarter. The modest decline of 2.0% in Asian markets did not reflect, as a result, a change in fundamentals; rather the absence of foreign liquidity compounded the depressing effects of sell orders. Second, domestic investors exercised caution given mounting concerns about inflation, widening current account deficits, less than banner earnings and political instability. Despite earnings that were in line with expectations, confidence in Malaysian stocks (down 5.4%) was undermined by the first half of 1995 GDP growth of 9.5%, which re-ignited concerns that the economy was overheating, an unexpectedly large trade deficit of MR5.5 billion, which posed a real risk of currency devaluation in the absence of higher interest rates, and infighting among the political elites. The Fund trimmed its exposure to Malaysia to raise cash for Japanese equity investments. The Fund overweighted the gaming and infrastructure sectors 1 and underweighted sunset industries such as plantations and mining. Core holdings like United Engineers and Genting were adversely affected, the former by its inability to procure an increase in tolls and the latter by mudslides that reduced patronage. Thai equities lost 7.8% over the quarter as investor sentiment was dampened by concerns that interest rates would be raised to combat a widening current account deficit and a weak baht, by food price inflation, by weak corporate earnings and by fears that the Banharn government would be toppled. Foreign share premiums contracted sharply. The Fund was overweighted in the banking, finance and telecommunications sectors. Only the banking sector outperformed during the period under review. Except for Korea, Hong Kong was the region's best performing market, gaining 3.6% for the quarter despite continued tensions between Hong Kong and China (especially after the resounding success of Hong Kong's pro-democracy candidates in recent elections). Earnings were in line with expectations and are expected to recover further given that corporations continue to undergo restructuring (unemployment rates are rising). Mass-end residential property prices have stabilized, boosting market sentiment of the property sector. The Fund continues to follow China-play stocks, which should benefit from an easing of credit given that China has confounded the skeptics and has apparently engineered a soft landing. Singapore was quiet, falling 2.1% on mixed corporate results. Korea was Asia's best performing market, gaining 9.8%. Korea's gains were driven by a fall in the three-year corporate bond yield (to below 12%) and the implementation of a 30% tax on short-term fixed income dividends that caused investors to shift funds into equities. Indonesia was listless, losing 5.8% on low volume. Not even a reported U.S.$25 billion of approved foreign investments year-to-date and better than expected earnings enthused investors. On the economic front, deteriorating trade and current account deficits as well as tight monetary policies depressed sentiment. The Philippines markets plummeted by 8.6% primarily because higher food prices pushed inflation into double-digits. The negative real interest rate environment discouraged foreign investors from committing funds to the Philippines despite the fact that corporate earnings were better than expected. AUSTRALIA Australian share prices registered gains of 9.9% in U.S. dollar terms in the third quarter as a result of lower interest rates worldwide, which provided a boost to the world growth and commodity price outlook, and an improving current account position, which helped to strengthen the Australian dollar. The Fund continued to focus on the blue-chips, which with the exception of News Corp. and Broken Hill Proprietary performed in line with expectations. INDIA The Indian market responded positively to two important events near quarter end, namely, an ordinance establishing depositories that will greatly simplify the stock transfer procedures and a relaxation of norms on forward trading by SEBI, the local stock exchange watchdog. These announcements pushed prices higher in local currency terms; however, the gains were offset by the steady devaluation of the rupee, yielding -3.2% in U.S. dollar terms. OUTLOOK Looking ahead, we continue to believe that the yen/ dollar rate will stabilize with a bias towards a weakening yen. Moreover, we maintain that interest rates in Japan will remain low. Both factors are favorable for the Japanese economy as is the recently announced economic stimulus package, which should begin to 2 filter through the economy in the months to come. Our portfolio strategy since earlier this year to overweight the high-tech and economic sensitive sectors will remain unchanged, and we believe that we can expect further gains from these stocks, contributing to favorable performance for the Fund. Given the strong fundamental picture and reasonable valuation (prospective PE of 11-12x) for the broad market, it is our opinion that it is an opportune time for medium and long-term investors to be invested in India, despite continuing political uncertainty. Provided that inflationary pressures are contained and that the current account deficit moderates, we expect Australia to continue its upward trend, particularly the resource sector, in light of the growth momentum exhibited by many OECD economies. We will continue to concentrate the Fund's holdings in the blue-chips. Going forward, we expect to maintain a neutral weighting for Hong Kong, which is still attractive at 13x '95 estimated earnings. In the event that either Malaysia and/or Thailand corrects significantly, however, we will shift additional funds to Hong Kong, which should benefit from an easing of credit in China. We will underweight Malaysia, which we believe will be trading range bounded because of lingering economic/currency concerns and because of credit controls that are likely to be implemented in the upcoming Budget. The Fund will focus on major cap stocks with defensive attributes. We expect to market weight Thailand, recognizing that the Kingdom should enjoy strong institutional support given the country's strong growth prospects and relatively cheap valuations vis-a-vis the rest of the region. We will maintain our focus on the banking, telecommunications and finance sectors. We will underweight Singapore given our view that foreign demand will decrease as the prospects for near-term currency appreciation wane. We will continue to be neutral relative to the benchmark in Indonesia, where we intend to participate in the upcoming privatization of PT Telkom, a good proxy to growth in the underlying economy. The widening current account deficit may create bouts of weakness in the market. In the Philippines we will remain slightly overweight, limiting ourselves to the market's bluechips. We intend to underweight Korea, wary that the weakened yen may hurt Korea's ability to export. Sincerely, [SIG] Barton M. Biggs CHAIRMAN [SIG] Ean Wah Chin SENIOR PORTFOLIO MANAGER November 2, 1995 3 Morgan Stanley Asia-Pacific Fund, Inc. Investment Summary as of September 30, 1995 - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
HISTORICAL INFORMATION TOTAL RETURN (%) ---------------------------------------------------------------------------- MARKET VALUE (1) NET ASSET VALUE (2) INDEX (3) ------------------------ ------------------------ ------------------------ AVERAGE AVERAGE AVERAGE CUMULATIVE ANNUAL CUMULATIVE ANNUAL CUMULATIVE ANNUAL ------------------------ ------------------------ ------------------------ CURRENT QUARTER 1.32% -- 3.13% -- 3.32% -- FISCAL YEAR TO DATE -7.99 -- 3.76 -- -1.79 -- ONE YEAR -8.49 -8.49% -1.85 -1.85% -4.83 -4.83% SINCE INCEPTION* -19.68 -17.19 -2.33 -2.01 -5.20 -4.49
PAST PERFORMANCE IS NOT PRODUCTIVE OF FUTURE PERFORMANCE - -------------------------------------------------------------------------------- RETURNS AND PER SHARE INFORMATION (2) EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
PERIODS ENDED SEPTEMBER 30: 1994* 9 MONTHS ENDED 9/30/95 (UNAUDITED) Net Asset Value $ 13.20 $ 13.68 Income Dividends 0.04 0.04 Capital Gains and Other Distributions 0.01 0.03 Fund Total Return (2) (5.94%) 3.76% Index total Return (3) (5.90%) (1.79%)
(1)Assumes dividends and distributions, if any, were reinvested. (2)Total investment return based on per share net asset value reflects the effects of changes in net asset value on the performance of the Fund during each period, and assumes dividends and distributions, if any, were reinvested. These percentages are not an indication of the performance of a shareholder's investment in the Fund based on market value due to differences between the market price of the stock and the net asset value of the Fund. (3)The benchmark for investment performance is the weighted average of the percentage change month-on-month of each of four Morgan Stanley Capital International (MSCI) indices; Japan, Combined Asia Free ex-Japan, Australia, and New Zealand, where the weights are based on the respective market capitalizations of these indices at the beginning of the month. *The Fund commenced operations on August 2, 1994. 4 Morgan Stanley Asia-Pacific Fund, Inc. Portfolio Summary as of September 30, 1995 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PORTFOLIO INVESTMENTS DIVERSIFICATION EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Equity Securities 98.6% Cash Equivalents 1.4%
- -------------------------------------------------------------------------------- SECTORS EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Electrical & Electronics 14.8% Real Estate 10.4% Banking 9.3% Multi-Industry 7.4% Machinery & Engineering 7.3% Telecommunications 6.9% Chemicals 5.0% Financial Services 4.3% Construction & Housing 4.1% Other 30.5%
- -------------------------------------------------------------------------------- TEN LARGEST HOLDINGS 1. Western Mining Corp. 2. HSBC Holdings plc 3. Broken Hill Proprietary Co. Ltd. 4. Lend Lease Corp. Ltd. 5. Toshiba Corp. 6. Hitachi Ltd. 7. National Australia Bank Ltd. 8. New World Development Co. Ltd. 9. Cheung Kong (Holdings) Ltd. 10. Hutchison Whampoa Ltd.
- -------------------------------------------------------------------------------- COUNTRY WEIGHTINGS EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Japan 40.8% Hong Kong 13.8% Australia 8.7% Malaysia 8.0% Singapore 6.8% Thailand 6.4% India 4.8% Indonesia 3.4% Korea 3.0% Philippines 2.2% Other 1.6% China 0.5%
5 INVESTMENTS (UNAUDITED) - --------- SEPTEMBER 30, 1995
VALUE SHARES (000) - ---------------------------------------------------------------- - ------------- COMMON STOCKS (98.4%) (Unless otherwise noted) - ---------------------------------------------------------------- - ------------- AUSTRALIA (8.7%) BANKING National Australia Bank Ltd. 1,284,614 U.S.$ 11,359 ------------ BROADCASTING & PUBLISHING News Corp. Ltd. 1,404,740 7,813 News Corp., Ltd. (Preferred) 3,393 17 ------------ 7,830 ------------ ENERGY SOURCES Broken Hill Proprietary Co. Ltd. 966,045 13,317 ------------ METALS -- NON-FERROUS Western Mining Corp. 2,544,750 16,655 ------------ REAL ESTATE Lend Lease Corp. Ltd. 923,862 13,056 ------------ TRANSPORTATION -- AIRLINES Quantas Airways Ltd. 1,169,000 2,085 ------------ 64,302 ------------ - ---------------------------------------------------------------- - ------------- CHINA (0.5%) AUTOMOBILES Shenzen North Jianshe Motorcycle 'B' 2,420,000 1,487 ------------ CHEMICALS Jilin Chemical Industrial Co. ADR 68,000 1,513 ------------ UTILITIES -- ELECTRICAL & GAS Shandong Huaneng Power Co. Ltd. ADR 132,000 1,172 ------------ 4,172 ------------ - ---------------------------------------------------------------- - ------------- HONG KONG (13.8%) BANKING HSBC Holdings plc 975,373 13,561 ------------ FINANCIAL SERVICES Peregrine Investment Holdings 900,000 1,350 ------------ FOOD & HOUSEHOLD PRODUCTS Charoen Pokphand Co. Ltd. 1,076,000 438 ------------ MULTI-INDUSTRY Citic Pacific Ltd. 1,299,000 3,923 Guangdong Investments Ltd. 12,300,000 7,358 Hutchison Whampoa Ltd. 2,000,000 10,838 Swire Pacific Ltd. 'A' 950,000 7,526 ------------ 29,645 ------------ REAL ESTATE Cheung Kong (Holdings) Ltd. 2,000,000 10,890 Hopewell Holdings 9,500,000 6,451 New World Development Co. Ltd. 2,800,000 11,045 Sun Hung Kai Properties Ltd. 1,000,000 8,116 Wharf (Holdings) Ltd. 390,000 1,216 ------------ 37,718 ------------ TELECOMMUNICATIONS Hong Kong Telecom Ltd. 4,800,000 8,723 ------------ UTILITIES -- ELECTRICAL & GAS China Light & Power Ltd. 1,900,000 9,830 ------------ 101,265 ------------ - ---------------------------------------------------------------- - ------------- VALUE SHARES (000) - --------------------------------------------------------- - ------------ INDIA (4.8%) APPLIANCES & HOUSEHOLD PRODUCTS Peico Electronics & Electric 138,300 U.S.$ 856 ------------ AUTOMOBILES Apollo Tyres Ltd. 91,500 386 Apollo Tyres Ltd. (Rights) expiring 2/15/95 261 -- Apollo Tyres Ltd. (Warrants) expiring 2/15/96 2,595 2 Autolec Industries 145,600 442 Autolite Ltd. 72,100 425 Escorts Ltd. 101,250 331 Hero Honda 10,000 70 Jay Bharat Maruti 53,200 100 Lumax Automatic Parts Industries 40,200 149 Rico Auto 30,000 102 Sona Steering System 92,500 256 SRF Nippondenso 4,800 12 Tata Engineering & Locomotive 3,850 76 ------------ 2,351 ------------ BANKING State Bank of India 779,200 5,042 ------------ BEVERAGES & TOBACCO United Breweries 649,100 497 ------------ BUILDING MATERIALS & COMPONENTS Associated Cement Co. 10,055 975 Murudeshwar Ceramics Ltd. 46,000 129 ------------ 1,104 ------------ CHEMICALS Gujarat Narmada Valley Fertilizers GDR 275,000 2,168 Indian Dyestuff Industries Ltd. 304,250 390 Indian Organic Chemical Ltd. 125,500 153 Jaysynth Dyechem 145,800 645 Saurashtra Cement & Chemicals, Class B 24,200 57 ------------ 3,413 ------------ CONSTRUCTION & HOUSING Larsen & Toubro 400 3 ------------ ELECTRICAL & ELECTRONICS BPL Ltd. 128,300 363 Crompton Greaves 311,530 1,791 Esab India Ltd. 252,000 449 Rolta India Ltd. 1,000,000 708 ------------ 3,311 ------------ ENERGY EQUIPMENT & SERVICES Bharat Heavy Electricals 738,600 2,286 ------------ FINANCIAL SERVICES Housing Development Finance Corp. 33,410 2,556 ------------ FOREST PRODUCTS & PAPER Ballarpur Industries Ltd. 204,964 1,214 ------------ HEALTH & PERSONAL CARE Sol Pharma 17,400 47 ------------ MACHINERY & ENGINEERING Artson Engineering Ltd. 135,700 156 ------------ METALS -- NON-FERROUS Hindalco 5,000 145 ------------ - ---------------------------------------------------------------- - -------------
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VALUE SHARES (000) - --------------------------------------------------------- - ------------ INDIA (CONTINUED) METALS -- STEEL Tata Iron & Steel 198,745 U.S.$ 1,424 ------------ MISCELLANEOUS MATERIALS & COMMODITIES Polyplex Ltd. 225,000 531 ------------ MULTI-INDUSTRY Bajaj Hindustan Ltd. 21,000 73 Container Corp. of India 910,000 2,106 EID Parry 64,300 248 Master Shares Ltd. 2,272,440 1,032 VXL Ltd. 743,000 783 ------------ 4,242 ------------ RECREATION, OTHER CONSUMER GOODS Cosmo Films Ltd. 175,000 727 Essel Packaging Ltd. 116,750 726 ------------ 1,453 ------------ TELECOMMUNICATIONS Infosys Technology Ltd. 9,600 131 Mahanagar Telephone Nigan 572,000 2,681 Videsh Sanchar Nigam Ltd. 4,000 100 ------------ 2,912 ------------ TEXTILES & APPAREL Coates of India Ltd. 56,750 410 G.T.N. Textiles 87,500 322 Indo Rama Synthetic 33,500 42 J.K. Synthetics Ltd. 73,000 69 Morajee Goculdas Spinning 125,000 645 Viniyoga Clothes Ltd. 399,000 235 ------------ 1,723 ------------ 35,266 ------------ - ---------------------------------------------------------------- - ------------- INDONESIA (3.4%) BUILDING MATERIALS & COMPONENTS Indocement Tunggal Prakarsa (Foreign) 120,000 437 Semen Gresik (Foreign) 587,000 1,658 ------------ 2,095 ------------ CHEMICALS Sorini Corp. (Foreign) 600,000 3,443 ------------ FOOD & HOUSEHOLD PRODUCTS Mayora Indah (Foreign) 13,500 21 ------------ FOREST PRODUCTS & PAPER Barito Pacific Timber (Foreign) 906,000 670 ------------ HEALTH & PERSONAL CARE Kalbe Farma (Foreign) 883,500 3,529 ------------ MACHINERY & ENGINEERING United Tractors (Foreign) 716,500 1,439 ------------ MISCELLANEOUS MATERIALS & COMMODITIES Charoen Pokphand Indonesia (Foreign) 2,510,000 5,540 ------------ REAL ESTATE Duta Pertiwi Property (Foreign) 280,000 346 ------------ RECREATION, OTHER CONSUMER GOODS Asiana IMI Industries (Foreign) 360,000 151 Modern Photo Film (Foreign) 204,000 1,171 ------------ 1,322 ------------ TELECOMMUNICATIONS Indosat (Foreign) 1,810,000 6,311 ------------ 24,716 ------------ - ---------------------------------------------------------------- - ------------- VALUE SHARES (000) - --------------------------------------------------------- - ------------ JAPAN (40.8%) AEROSPACE & MILITARY TECHNOLOGY Daibiru Corp. 308,000 U.S.$ 3,514 Mitsubishi Heavy Industries Ltd. 1,220,000 9,360 ------------ 12,874 ------------ AUTOMOBILES Asahi Tec Corp. 360,000 2,326 Kansei Corp. 170,000 1,338 Nissan Motor Co. 900,000 6,487 Suzuki Motor Co. Ltd. 660,000 7,129 ------------ 17,280 ------------ BUILDING MATERIALS & COMPONENTS Amada Co. Ltd. 500,000 4,957 ------------ BUSINESS & PUBLIC SERVICES Dai Nippon Printing Co. Ltd. 280,000 4,438 ------------ CHEMICALS Daicel Chemical Industries 750,000 4,315 Fuji Photo Film Ltd. 160,000 3,990 Ito Yokado Co. Ltd. 80,000 4,426 Kaneka Corp. 999,000 6,354 Okura Industrial Co. Ltd. 434,000 2,804 Sekisui Chemical Co. 520,000 6,615 ------------ 28,504 ------------ CONSTRUCTION & HOUSING Kyudenko Co. Ltd. 349,000 4,722 Matsui Construction 171,000 1,350 Nishio Rent All Co. 111,000 2,633 Nishio Rent All Co. (Warrants), expiring 2/20/98 1,055 448 Taisei Corp. Ltd. 1,240,000 8,237 Takasago Thermal Engineering 240,000 3,610 Yahagi Construction 238,000 1,917 ------------ 22,917 ------------ ELECTRICAL & ELECTRONICS Canon Inc. 90,000 1,608 Hitachi Ltd. 1,085,000 11,830 Kyocera Corp. 40,000 3,287 Kyocera Corp. (Warrants), expiring 1/23/98 1,450 2,693 Matsushita Communication Industries 191,000 4,608 Matsushita Electric Industries Ltd. 555,000 8,516 Mitsumi Electric Co. Ltd. 388,000 8,696 NEC Corp. 775,000 10,797 Nintendo Ltd. 115,000 8,417 Nitto Denko Corp. 182,000 2,774 Ricoh Co. Ltd. 700,000 7,010 Secom Co. 94,000 6,263 Sony Corp. 140,000 7,265 Stanley Electric Co. 750,000 4,770 Toshiba Corp. 1,630,000 11,930 ------------ 100,464 ------------ ELECTRONIC COMPONENTS & INSTRUMENTS TDK Corp. 135,000 6,951 ------------ ENERGY EQUIPMENT & SERVICES Kurita Water Industries 136,000 3,707 ------------ FINANCIAL SERVICES Hitachi Credit Corp. 118,000 2,001 Nikko Securities Co. 700,000 6,933 Nomura Securities Co. 335,000 6,561 Sumitomo Lease 102,000 515 ------------ 16,010 ------------ - ---------------------------------------------------------------- - -------------
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VALUE SHARES (000) - --------------------------------------------------------- - ------------ JAPAN (CONTINUED) HEALTH & PERSONAL CARE Inabata & Co. 249,000 U.S.$ 1,483 Sankyo Co. Ltd. 217,000 4,951 Santen Pharmaceutical Co. 55,000 1,383 Yamanouchi Pharmaceutical Co. 240,000 5,185 ------------ 13,002 ------------ INSURANCE Nichido Fire & Marine Insurance Co. 205,000 1,685 Sumitomo Marine & Fire 600,000 4,549 ------------ 6,234 ------------ MACHINERY & ENGINEERING Daifuku 450,000 5,497 Daikin Kogyo Co. 600,000 5,112 Fuji Machine Co. 256,000 10,156 Nifco 283,000 3,486 Obayashi Corp. 250,000 1,969 Teijin Seiki Co. 431,000 1,819 Tsubakimoto Chain 817,000 4,132 ------------ 32,171 ------------ METALS -- STEEL Sanwa Shutter Corp. Ltd. 48,000 368 Sanwa Shutter Corp. Ltd. (Warrants), expiring 1/20/98 1,400 280 ------------ 648 ------------ MULTI-INDUSTRY FamilyMart 147,300 6,394 ------------ REAL ESTATE Keihanshin Real Estate Co. 205,000 1,455 Mitsubishi Estate Co. Ltd. 470,000 5,267 ------------ 6,722 ------------ TELECOMMUNICATIONS Nippon Telephone & Telegraph 612 5,270 ------------ TEXTILES & APPAREL Japan Vilene Co. Ltd. 304,000 1,841 ------------ TRANSPORTATION -- ROAD & RAIL Nippon Konpo Unyu Soko 295,000 2,380 Tokyu Corp. 590,000 3,978 ------------ 6,358 ------------ WHOLESALE & INTERNATIONAL TRADE Sangetsu Co. Ltd. 100,000 2,413 ------------ 299,155 ------------ - ---------------------------------------------------------------- - ------------- KOREA (3.0%) APPLIANCES & HOUSEHOLD PRODUCTS Samsung Electronics Co. (Foreign) 34,059 8,439 Samsung Electronics Co. (New) 6,642 1,636 ------------ 10,075 ------------ CONSTRUCTION & HOUSING Hyundai Engeering (Rights) 8,523 448 Hyundai Engineering (Foreign) 124,440 6,544 ------------ 6,992 ------------ METALS -- STEEL Pohang Iron & Steel ADR 43,500 1,430 ------------ UTILITIES -- ELECTRICAL & GAS Korea Electric Power (Foreign) 93,920 3,533 ------------ 22,030 ------------ - ---------------------------------------------------------------- - ------------- VALUE SHARES (000) - --------------------------------------------------------- - ------------ MALAYSIA (8.0%) BANKING Malayan Banking Bhd 1,127,000 U.S.$ 9,108 ------------ LEISURE & TOURISM Genting Bhd 513,000 4,431 Resorts World Bhd 768,000 3,822 ------------ 8,253 ------------ MACHINERY & ENGINEERING United Engineers, Ltd. 1,414,000 9,063 ------------ MULTI-INDUSTRY Renong Bhd 5,468,000 9,491 ------------ REAL ESTATE Bandar Raya Developments Bhd 1,640,000 3,095 ------------ TELECOMMUNICATIONS Technology Resources Industries Bhd 1,444,000 3,765 Telekom Malaysia Bhd 1,122,000 8,442 ------------ 12,207 ------------ UTILITIES -- ELECTRICAL & GAS Tenaga Nasional Bhd 1,920,000 7,338 ------------ 58,555 ------------ - ---------------------------------------------------------------- - ------------- PHILIPPINES (2.2%) BANKING Philippine National Bank 53,380 558 ------------ BEVERAGES & TOBACCO San Miguel Corp. 'B' 260,000 918 ------------ ENERGY SOURCES Petron Corp. 7,127,500 3,351 ------------ MULTI-INDUSTRY Ayala Corp. 'B' 205,800 201 JG Summit Holdings 'B' 5,500,000 1,625 ------------ 1,826 ------------ REAL ESTATE Ayala Land, Inc. 'B' 2,265,750 2,522 C&P Homes, Inc. 1,279,000 798 SM Prime Holdings, Inc. 8,031,400 2,404 ------------ 5,724 ------------ TELECOMMUNICATIONS Philippine Long Distance Telephone 'B' 28,000 1,869 ------------ UTILITIES -- ELECTRICAL & GAS Manila Electric Co. 'B' 285,270 2,179 ------------ 16,425 ------------ - ---------------------------------------------------------------- - ------------- SINGAPORE (6.8%) BANKING Development Bank of Singapore (Foreign) 448,000 5,099 Oversea Chinese Banking Corp. (Foreign) 480,000 5,430 United Overseas Bank (Foreign) 979,200 8,463 ------------ 18,992 ------------ BEVERAGES & TOBACCO Fraser & Neave 396,000 4,591 ------------ BROADCASTING & PUBLISHING Singapore Press Holdings (Foreign) 120,000 1,838 ------------ ELECTRICAL & ELECTRONICS Acma Ltd. 237,000 874 ------------ - ---------------------------------------------------------------- - -------------
8
VALUE SHARES (000) - ---------------------------------------------------------------- - ------------- SINGAPORE (CONTINUED) MACHINERY & ENGINEERING Keppel Corp. 912,000 U.S.$ 7,305 Sembawang Shipyards 612,000 3,204 ------------ 10,509 ------------ MULTI-INDUSTRY Singapore Technologies Industrial Corp. 1,534,000 2,652 ------------ REAL ESTATE City Developments Ltd. 944,000 5,837 DBS Land Ltd. 1,560,000 4,626 ------------ 10,463 ------------ 49,919 ------------ - ---------------------------------------------------------------- - ------------- THAILAND (6.4%) BANKING Bangkok Bank Ltd. (Foreign) 60,000 674 Bangkok Bank Ltd. (Local) 162,000 1,330 Siam Commercial Bank Co., Ltd. (Foreign) 410,000 4,607 Thai Farmers Bank Ltd. (Foreign) 599,000 3,915 ------------ 10,526 ------------ BUILDING MATERIALS & COMPONENTS Siam Cement Co., Ltd. (Foreign) 62,800 3,704 ------------ ELECTRICAL & ELECTRONICS Shinawatra Computer Co. Ltd. (Foreign) 186,800 4,615 ------------ FINANCIAL SERVICES Finance One Co. Ltd. (Foreign) 163,527 997 Finance One Co., Ltd. (Local) 728,973 3,922 National Finance & Securities Co., Ltd. (Foreign) 649,000 3,129 National Finance & Securities Co., Ltd.(Foreign) (Warrants), expiring 11/15/99 73,000 -- Phatra Thanakit Co., Ltd. (Foreign) 513,135 3,721 Phatra Thanakit Co., Ltd. (Local) 65 -- ------------ 11,769 ------------ MISCELLANEOUS MATERIALS & COMMODITIES Charoen Pokphand Feedmill Co., Ltd. (Local) 668,000 2,955 ------------ TELECOMMUNICATIONS Advanced Information Services Co. Ltd. (Foreign) 274,200 4,327 TelecomAsia Corp. Ltd. (Foreign) 920,000 2,768 Thai Telephone and Telecommunications Co. (Foreign) 530,000 3,696 United Communication Industry (Foreign) 175,000 2,273 ------------ 13,064 ------------ 46,633 ------------ - ---------------------------------------------------------------- - ------------- TOTAL COMMON STOCKS (Cost U.S. $732,563) 722,438 ------------ - ---------------------------------------------------------------- - ------------- FACE AMOUNT VALUE (000) (000) - --------------------------------------------------------- - ------------ SHORT TERM INVESTMENT (0.6%) - --------------------------------------------------------- - ------------ UNITED STATES (0.6%) REPURCHASE AGREEMENT Chase Manhattan Bank N.A., 6.00%, dated 9/29/95, due 10/2/95, `to be repurchased at U.S.$4,066, collateralized by U.S.$3,290 United States Treasury Bonds 8.875% due 2/15/19, valued at U.S.$4,150 (Cost $4,064) U.S.$ 4,064 U.S.$ 4,064 ------------ - ---------------------------------------------------------------- - ------------- FOREIGN CURRENCY ON DEPOSIT WITH CUSTODIAN (0.9%) Indian Rupee INR 182,775 5,387 Japanese Yen JPY 15,294 154 Philippine Peso PHP 13,483 518 Thai Baht THB 8,327 332 ------------ (Cost U.S. $6,820) 6,391 ------------ - ---------------------------------------------------------------- - ------------- TOTAL INVESTMENTS (99.9%) (Cost U.S. $743,447) 732,893 ------------ - ---------------------------------------------------------------- - ------------- OTHER ASSETS & LIABILITIES (0.1%) Other Assets U.S.$ 3,458 Liabilities (2,376) 1,082 ------------- ------------ - ---------------------------------------------------------------- - ------------- NET ASSETS (100.0%) Applicable to 53,654,508 issued and outstanding U.S. $.01 par value shares (100,000,000 shares authorized) U.S.$733,975 ------------- - ---------------------------------------------------------------- - ------------- NET ASSET VALUE PER SHARE U.S.$ 13.68 ------------- - ---------------------------------------------------------------- - -------------
ADR--American Depositary Receipt GDR--Global Depositary Receipt Note: Prior government approval for foreign investments may be required under certain circumstances in some emerging markets, and foreign ownership limitations may also be imposed by the charters of individual companies in emerging markets. As a result, an additional class of shares designated as "foreign" may be created and offered for investment. The "local" and "foreign" shares' market values may vary. 9 -----END PRIVACY-ENHANCED MESSAGE-----