Templeton Dragon Fund (TDF) NPORT-P Templeton Dragon Fund, Inc. (Sep 2022 report)

Not

FDIC

Insured

May

Lose

Value

No

Bank

Guarantee

TLTDF-Q3PH

1

Consolidated

Schedule

of

Investments

(unaudited)

Templeton

Dragon

Fund,

Inc.

2

Notes

to

Consolidated

Schedule

of

Investments

6

Templeton

Dragon

Fund,

Inc.

Consolidated

Schedule

of

Investments

(unaudited),

September

30,

2022

Quarterly

Consolidated

Schedule

of

Investments

See

Notes

to

Consolidated

Schedule

of

Investments.

2

l

a

a

Country

Shares

a

Value

a

a

a

a

a

a

Common

Stocks

98.5%

Air

Freight

&

Logistics

1.4%

a

SF

Holding

Co.

Ltd.,

A

..................................

China

764,700

$

5,061,478

Auto

Components

1.0%

Minth

Group

Ltd.

......................................

China

1,586,910

3,484,872

Automobiles

2.6%

a

BYD

Co.

Ltd.,

A

.......................................

China

86,000

3,039,750

BYD

Co.

Ltd.,

H

......................................

China

127,000

3,128,716

Geely

Automobile

Holdings

Ltd.

...........................

China

565,135

773,382

b

NIO,

Inc.,

ADR

.......................................

China

161,675

2,549,615

9,491,463

Banks

5.9%

a

China

Merchants

Bank

Co.

Ltd.,

A

.........................

China

1,688,900

7,957,568

China

Merchants

Bank

Co.

Ltd.,

H

.........................

China

2,004,448

9,276,307

a

Ping

An

Bank

Co.

Ltd.,

A

................................

China

1,194,600

1,983,524

c

Postal

Savings

Bank

of

China

Co.

Ltd.,

H,

144A,

Reg

S

.........

China

3,329,649

1,957,052

21,174,451

Beverages

6.5%

China

Resources

Beer

Holdings

Co.

Ltd.

....................

China

863,210

5,987,857

a

Kweichow

Moutai

Co.

Ltd.,

A

.............................

China

34,745

9,112,364

a

Luzhou

Laojiao

Co.

Ltd.,

A

...............................

China

166,856

5,402,348

a

Wuliangye

Yibin

Co.

Ltd.,

A

..............................

China

126,100

2,989,188

23,491,757

Biotechnology

2.0%

b

BeiGene

Ltd.

.........................................

China

122,569

1,263,856

b,d

I-Mab,

ADR

..........................................

China

200,893

805,581

b,c,d

InnoCare

Pharma

Ltd.,

144A,

Reg

S

.......................

China

1,418,000

1,428,272

b,c

Innovent

Biologics,

Inc.,

144A,

Reg

S

......................

China

630,172

1,936,718

a

Jinyu

Bio-Technology

Co.

Ltd.,

A

..........................

China

1,722,700

1,885,649

7,320,076

Capital

Markets

2.0%

a

East

Money

Information

Co.

Ltd.,

A

........................

China

1,626,272

4,007,972

Hong

Kong

Exchanges

&

Clearing

Ltd.

.....................

Hong

Kong

90,257

3,085,202

7,093,174

Chemicals

3.9%

a

Guangzhou

Tinci

Materials

Technology

Co.

Ltd.,

A

.............

China

1,640,180

10,104,100

a

Jiangsu

Yangnong

Chemical

Co.

Ltd.,

A

....................

China

269,600

3,774,690

13,878,790

Construction

Materials

2.3%

a

Beijing

Oriental

Yuhong

Waterproof

Technology

Co.

Ltd.,

A

......

China

1,777,718

6,574,426

a,b

Keshun

Waterproof

Technologies

Co.

Ltd.,

A

.................

China

1,261,900

1,684,583

8,259,009

Containers

&

Packaging

1.1%

a

Zhejiang

Jiemei

Electronic

&

Technology

Co.

Ltd.,

A

...........

China

1,142,600

3,859,822

Electrical

Equipment

5.1%

a

Contemporary

Amperex

Technology

Co.

Ltd.,

A

...............

China

88,000

4,937,554

a

Hongfa

Technology

Co.

Ltd.,

A

............................

China

1,594,209

7,761,952

a

Sunwoda

Electronic

Co.

Ltd.,

A

...........................

China

1,769,600

5,759,177

18,458,683

Templeton

Dragon

Fund,

Inc.

Consolidated

Schedule

of

Investments

(unaudited)

See

Notes

to

Consolidated

Schedule

of

Investments.

Quarterly

Consolidated

Schedule

of

Investments

3

a

a

Country

Shares

a

Value

a

a

a

a

a

a

Common

Stocks

(continued)

Electronic

Equipment,

Instruments

&

Components

1.3%

a

Luxshare

Precision

Industry

Co.

Ltd.,

A

.....................

China

1,156,638

$

4,754,294

Entertainment

2.6%

b,d

Bilibili,

Inc.,

ADR

......................................

China

33,494

513,128

NetEase,

Inc.

........................................

China

582,379

8,787,770

9,300,898

Food

&

Staples

Retailing

1.0%

a

Laobaixing

Pharmacy

Chain

JSC,

A

.......................

China

771,268

3,466,716

Food

Products

1.2%

a

Inner

Mongolia

Yili

Industrial

Group

Co.

Ltd.,

A

...............

China

917,300

4,241,322

Health

Care

Equipment

&

Supplies

2.0%

a

Shenzhen

Mindray

Bio-Medical

Electronics

Co.

Ltd.,

A

..........

China

168,701

7,071,422

Health

Care

Providers

&

Services

1.7%

a

Aier

Eye

Hospital

Group

Co.

Ltd.,

A

........................

China

1,206,443

4,849,838

b,c,d

New

Horizon

Health

Ltd.,

144A,

Reg

S

.....................

China

754,000

1,384,942

6,234,780

Hotels,

Restaurants

&

Leisure

1.4%

Yum

China

Holdings,

Inc.

...............................

China

108,078

5,115,332

Household

Durables

4.3%

a

Haier

Smart

Home

Co.

Ltd.,

A

............................

China

1,218,400

4,217,959

a

Midea

Group

Co.

Ltd.,

A

................................

China

1,084,316

7,490,673

a

Suofeiya

Home

Collection

Co.

Ltd.,

A

......................

China

1,585,100

3,731,947

15,440,579

Insurance

0.8%

a

Ping

An

Insurance

Group

Co.

of

China

Ltd.,

A

................

China

166,850

970,770

Ping

An

Insurance

Group

Co.

of

China

Ltd.,

H

................

China

371,927

1,855,468

2,826,238

Interactive

Media

&

Services

9.3%

b,d

Baidu,

Inc.,

ADR

......................................

China

47,581

5,590,292

b,c

Kuaishou

Technology,

144A,

Reg

S

........................

China

219,488

1,407,829

Tencent

Holdings

Ltd.

..................................

China

781,026

26,380,183

33,378,304

Internet

&

Direct

Marketing

Retail

13.1%

b

Alibaba

Group

Holding

Ltd.

..............................

China

2,166,738

21,622,612

JD.com,

Inc.,

A

.......................................

China

513,312

12,949,929

b,c

Meituan

Dianping,

B,

144A,

Reg

S

........................

China

599,841

12,606,534

47,179,075

IT

Services

0.8%

b,d

GDS

Holdings

Ltd.,

ADR

................................

China

158,752

2,803,560

Life

Sciences

Tools

&

Services

4.7%

c

Hangzhou

Tigermed

Consulting

Co.

Ltd.,

H,

144A,

Reg

S

.......

China

138,000

1,109,482

a

WuXi

AppTec

Co.

Ltd.,

A

................................

China

386,480

3,863,516

c

WuXi

AppTec

Co.

Ltd.,

H,

144A,

Reg

S

.....................

China

626,008

4,999,723

b,c

Wuxi

Biologics

Cayman,

Inc.,

144A,

Reg

S

..................

China

1,140,850

6,791,305

16,764,026

Machinery

3.6%

a

Estun

Automation

Co.

Ltd.,

A

.............................

China

306,700

808,052

Templeton

Dragon

Fund,

Inc.

Consolidated

Schedule

of

Investments

(unaudited)

Quarterly

Consolidated

Schedule

of

Investments

See

Notes

to

Consolidated

Schedule

of

Investments.

4

a

a

Country

Shares

a

Value

a

a

a

a

a

a

Common

Stocks

(continued)

Machinery

(continued)

a

Jiangsu

Hengli

Hydraulic

Co.

Ltd.,

A

.......................

China

206,300

$

1,306,322

a

Shenzhen

Inovance

Technology

Co.

Ltd.,

A

..................

China

988,600

7,968,360

Weichai

Power

Co.

Ltd.,

H

..............................

China

2,826,261

2,677,485

12,760,219

Media

0.4%

b,c

Mobvista,

Inc.,

144A,

Reg

S

.............................

China

3,098,200

1,538,656

Metals

&

Mining

0.7%

CMOC

Group

Ltd.,

H

...................................

China

6,516,000

2,529,867

Pharmaceuticals

0.4%

a

Jiangsu

Hengrui

Medicine

Co.

Ltd.,

A

......................

China

303,407

1,490,197

a,b,e,f

Kangmei

Pharmaceutical

Co.

Ltd.

.........................

China

673,786

117,075

1,607,272

Professional

Services

0.6%

a

Centre

Testing

International

Group

Co.

Ltd.,

A

................

China

708,900

2,023,145

Real

Estate

Management

&

Development

1.1%

China

Resources

Land

Ltd.

..............................

China

786,375

3,080,142

Country

Garden

Services

Holdings

Co.

Ltd.

..................

China

489,600

714,827

3,794,969

Semiconductors

&

Semiconductor

Equipment

6.5%

b

Daqo

New

Energy

Corp.,

ADR

...........................

China

66,428

3,525,998

b,c

Hua

Hong

Semiconductor

Ltd.,

144A,

Reg

S

.................

China

1,745,624

3,953,877

a

LONGi

Green

Energy

Technology

Co.

Ltd.,

A

.................

China

1,060,892

7,092,690

a

Sino

Wealth

Electronic

Ltd.,

A

............................

China

1,277,220

5,943,220

a

Will

Semiconductor

Co.

Ltd.

Shanghai,

A

....................

China

240,369

2,691,783

23,207,568

Software

0.7%

a

Hundsun

Technologies,

Inc.,

A

............................

China

512,921

2,432,423

Specialty

Retail

2.6%

a

China

Tourism

Group

Duty

Free

Corp.

Ltd.,

A

................

China

345,300

9,507,423

Textiles,

Apparel

&

Luxury

Goods

3.2%

ANTA

Sports

Products

Ltd.

..............................

China

1,110,075

11,652,229

Transportation

Infrastructure

0.7%

a,b

Shanghai

International

Airport

Co.

Ltd.,

A

....................

China

300,800

2,431,459

Total

Common

Stocks

(Cost

$357,244,152)

.....................................

353,635,351

Principal

Amount

*

Convertible

Bonds

0.2%

Electrical

Equipment

0.2%

a

Hongfa

Technology

Co.

Ltd.

,

Zero

Cpn.,

10/27/27

.............

China

3,325,000

CNY

536,448

Electronic

Equipment,

Instruments

&

Components

0.0%

†

a

Luxshare

Precision

Industry

Co.

Ltd.

,

0.1

%

,

11/03/26

...........

China

583,100

CNY

91,111

Templeton

Dragon

Fund,

Inc.

Consolidated

Schedule

of

Investments

(unaudited)

See

Notes

to

Consolidated

Schedule

of

Investments.

Quarterly

Consolidated

Schedule

of

Investments

5

a

a

Country

Principal

Amount

*

a

Value

a

a

a

a

a

Convertible

Bonds

(continued)

Semiconductors

&

Semiconductor

Equipment

0.0%

†

a,g

LONGi

Green

Energy

Technology

Co.

Ltd.

,

FRN,

0.2%,

1/0

5

/28

...

China

980,000

CNY

$

169,967

Total

Convertible

Bonds

(Cost

$766,014)

.......................................

797,526

Total

Long

Term

Investments

(Cost

$358,010,166)

...............................

354,432,877

a

Short

Term

Investments

0.9%

a

a

Country

Shares

a

Value

a

a

a

Money

Market

Funds

0.8%

h,i

Institutional

Fiduciary

Trust

-

Money

Market

Portfolio,

2.42%

.....

United

States

2,748,412

2,748,412

Total

Money

Market

Funds

(Cost

$2,748,412)

...................................

2,748,412

a

a

a

Investments

from

Cash

Collateral

Received

for

Loaned

Securities

0.1%

Money

Market

Funds

0.1%

h,i

Institutional

Fiduciary

Trust

-

Money

Market

Portfolio,

2.42%

.....

United

States

471,350

471,350

Total

Investments

from

Cash

Collateral

Received

for

Loaned

Securities

(Cost

$471,350)

.............................................................

471,350

Total

Short

Term

Investments

(Cost

$3,219,762

)

.................................

3,219,762

a

Total

Investments

(Cost

$361,229,928)

99.6%

...................................

$357,652,639

Other

Assets,

less

Liabilities

0.4%

.............................................

1,599,424

Net

Assets

100.0%

...........................................................

$359,252,063

See

Abbreviations

on

page

9

.

*

The

principal

amount

is

stated

in

U.S.

dollars

unless

otherwise

indicated.

†

Rounds

to

less

than

0.1%

of

net

assets.

a

The

security

is

owned

by

Templeton

China

Opportunities

Fund,

Ltd.,

a

wholly-owned

subsidiary

of

the

Fund.

See

Note

5.

b

Non-income

producing.

c

Security

was

purchased

pursuant

to

Rule

144A

or

Regulation

S

under

the

Securities

Act

of

1933.

144A

securities

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.

Regulation

S

securities

cannot

be

sold

in

the

United

States

without

either

an

effective

registration

statement

filed

pursuant

to

the

Securities

Act

of

1933,

or

pursuant

to

an

exemption

from

registration.

At

September

30,

2022,

the

aggregate

value

of

these

securities

was

$39,114,390,

representing

10.9%

of

net

assets.

d

A

portion

or

all

of

the

security

is

on

loan

at

September

30,

2022.

e

Fair

valued

using

significant

unobservable

inputs.

See

Note

6

regarding

fair

value

measurements.

f

See

Note

3

regarding

restricted

securities.

g

The

coupon

rate

shown

represents

the

rate

at

period

end.

h

See

Note

4

regarding

investments

in

affiliated

management

investment

companies.

i

The

rate

shown

is

the

annualized

seven-day

effective

yield

at

period

end.

Templeton

Dragon

Fund,

Inc.

Notes

to

Consolidated

Schedule

of

Investments

(unaudited)

6

Quarterly

Consolidated

Schedule

of

Investments

1.

Organization

Templeton

Dragon

Fund,

Inc. (Trust)

is

registered

under

the

Investment

Company

Act

of

1940

(1940

Act)

as

a

closed-end

management

investment

company

and

applies

the

specialized

accounting

and

reporting

guidance

in

U.S.

Generally

Accepted

Accounting

Principles

(U.S.

GAAP). 

2. Financial

Instrument

Valuation

The

Fund's investments

in

financial

instruments

are

carried

at

fair

value

daily.

Fair

value

is

the

price

that

would

be

received

to

sell

an

asset

or

paid

to

transfer

a

liability

in

an

orderly

transaction

between

market

participants

on

the

measurement

date.

The

Fund

calculates the

net

asset

value

(NAV)

per

share

each

business

day

as

of

4

p.m.

Eastern

time

or

the

regularly

scheduled

close

of

the

New

York

Stock

Exchange

(NYSE),

whichever

is

earlier.

Under

compliance

policies

and

procedures

approved

by

the

Fund’s

Board

of

Directors

(the

Board),

the

Board

has

designated

the

Fund’s

investment

manager

as

the

valuation

designee

and

has

responsibility

for

oversight

of

valuation.

The

investment

manager

is

assisted

by

the

Fund’s

administrator

in

performing

this

responsibility,

including

leading

the

cross-functional

Valuation

Committee

(VC).

The

Fund

may

utilize

independent

pricing

services,

quotations

from

securities

and

financial

instrument

dealers,

and

other

market

sources

to

determine

fair

value. 

Equity

securities

listed

on

an

exchange

or

on

the

NASDAQ

National

Market

System

are

valued

at

the

last

quoted

sale

price

or

the

official

closing

price

of

the

day,

respectively.

Foreign

equity

securities

are

valued

as

of

the

close

of

trading

on

the

foreign

stock

exchange

on

which

the

security

is

primarily

traded

or

as

of

4

p.m.

Eastern

time.

The

value

is

then

converted

into

its

U.S.

dollar

equivalent

at

the

foreign

exchange

rate

in

effect

at

4

p.m. Eastern

time

on

the

day

that

the

value

of

the

security

is

determined.

Over-the-counter

(OTC)

securities

are

valued

within

the

range

of

the

most

recent

quoted

bid

and

ask

prices.

Securities

that

trade

in

multiple

markets

or

on

multiple

exchanges

are

valued

according

to

the

broadest

and

most

representative

market.

Certain

equity

securities

are

valued

based

upon

fundamental

characteristics

or

relationships

to

similar

securities. 

Debt

securities

generally

trade

in

the

OTC

market

rather

than

on

a

securities

exchange.

The Fund's

pricing

services

use

multiple

valuation

techniques

to

determine

fair

value.

In

instances

where

sufficient

market

activity

exists,

the

pricing

services

may

utilize

a

market-based

approach

through

which

quotes

from

market

makers

are

used

to

determine

fair

value.

In

instances

where

sufficient

market

activity

may

not

exist

or

is

limited,

the

pricing

services

also

utilize

proprietary

valuation

models

which

may

consider

market

characteristics

such

as

benchmark

yield

curves,

credit

spreads,

estimated

default

rates,

anticipated

market

interest

rate

volatility,

coupon

rates,

anticipated

timing

of

principal

repayments,

underlying

collateral,

and

other

unique

security

features

in

order

to

estimate

the

relevant

cash

flows,

which

are

then

discounted

to

calculate

the

fair

value.

Securities

denominated

in

a

foreign

currency

are

converted

into

their

U.S.

dollar

equivalent

at

the

foreign

exchange

rate

in

effect

at

4

p.m.

Eastern

time

on

the

date

that

the

values

of

the

foreign

debt

securities

are

determined.

Investments

in

open-end

mutual

funds

are

valued

at

the

closing

NAV.

The

Fund

has procedures

to

determine

the

fair

value

of

financial

instruments

for

which

market

prices

are

not

reliable

or

readily

available.

Under

these

procedures,

the

Fund

primarily employs

a

market-based

approach

which

may

use

related

or

comparable

assets

or

liabilities,

recent

transactions,

market

multiples,

book

values,

and

other

relevant

information

for

the

investment

to

determine

the

fair

value

of

the

investment.

An

income-based

valuation

approach

may

also

be

used

in

which

the

anticipated

future

cash

flows

of

the

investment

are

discounted

to

calculate

fair

value.

Discounts

may

also

be

applied

due

to

the

nature

or

duration

of

any

restrictions

on

the

disposition

of

the

investments.

Due

to

the

inherent

uncertainty

of

valuations

of

such

investments,

the

fair

values

may

differ

significantly

from

the

values

that

would

have

been

used

had

an

active

market

existed. 

Trading

in

securities

on

foreign

securities

stock

exchanges

and

OTC

markets

may

be

completed

before

4

p.m.

Eastern

time.

In

addition,

trading

in

certain

foreign

markets

may

not

take

place

on

every

Fund’s

business

day.

Events

can

occur

between

the

time

at

which

trading

in

a

foreign

security

is

completed

and

4

p.m.

Eastern

time

that

might

call

into

question

the

reliability

Templeton

Dragon

Fund,

Inc.

Notes

to

Consolidated

Schedule

of

Investments

(unaudited)

7

Quarterly

Consolidated

Schedule

of

Investments

of

the

value

of

a

portfolio

security

held

by

the

Fund.

As

a

result,

differences

may

arise

between

the

value

of

the

Fund’s

portfolio securities

as

determined

at

the

foreign

market

close

and

the

latest

indications

of

value

at

4

p.m.

Eastern

time.

In

order

to

minimize

the

potential

for

these

differences,

an

independent

pricing

service

may

be

used

to

adjust

the

value

of

the

Fund’s

portfolio

securities

to

the

latest

indications

of

fair

value

at 4

p.m

Eastern

time.

At

September

30,

2022,

certain

securities

may

have

been

fair

valued

using

these

procedures,

in

which

case

the

securities

were

categorized

as

Level

2

inputs

within

the

fair

value

hierarchy

(referred

to

as

"market

level

fair

value").

See

the

Fair

Value

Measurements

note

for

more

information.

When

the

last

day

of

the

reporting

period

is

a

non-business

day,

certain

foreign

markets

may

be

open

on

those

days

that

the

Fund’s

NAV

is

not

calculated,

which

could

result

in

differences

between

the

value

of

the

Fund’s

portfolio

securities

on

the

last

business

day

and

the

last

calendar

day

of

the

reporting

period.

Any

security

valuation

changes

due

to

an

open

foreign

market

are

adjusted

and

reflected

by

the

Fund for

financial

reporting

purposes.

3.

Restricted

Securities

At

September

30,

2022,

investments

in

restricted

securities,

excluding

securities

exempt

from

registration

under

the

Securities

Act

of

1933,

were

as

follows:

4.

Investments

in

Affiliated

Management

Investment

Companies 

The

Fund

invests

in

one

or

more

affiliated

management

investment

companies.

As

defined

in

the

1940

Act,

an

investment

is

deemed

to

be

a

“Controlled

Affiliate”

of

a

fund

when

a

fund

owns,

either

directly

or

indirectly,

25%

or

more

of

the

affiliated

fund’s

outstanding

shares

or

has

the

power

to

exercise

control

over

management

or

policies

of

such

fund.

The

Fund

does

not

invest for

purposes

of

exercising

a

controlling

influence

over

the

management

or

policies.

During

the

period

ended

September

30,

2022,

the

Fund

held

investments

in

affiliated

management

investment

companies

as

follows: 

Shares

Issuer

Acquisition

Date

Cost

Value

Templeton

Dragon

Fund

,

Inc

.

673,786

Kangmei

Pharmaceutical

Co

Ltd

................

4/06/22

$

—

$

117,075

Total

Restricted

Securities

(Value

is

0.0%

†

of

Net

Assets)

.............

$—

$117,075

†

Rounds

to

less

than

0.1%

of

net

assets.

    aa

Value

at

Beginning

of

Period

Purchases

Sales

Realized

Gain

(Loss)

Net

Change

in

Unrealized

Appreciation

(Depreciation)

Value

at

End

of

Period

Number

of

Shares

Held

at

End

of

Period

Investment

Income

a      

a  

a  

a  

a  

a  

a  

a  

Templeton

Dragon

Fund,

Inc.

Non-Controlled

Affiliates

Dividends

Institutional

Fiduciary

Trust

-

Money

Market

Portfolio,

2.42%

.

$

3,885,145

$

57,910,631

$

(59,047,364)

$

—

$

—

$

2,748,412

2,748,412

$

29,690

Non-Controlled

Affiliates

Income

from

securities

loaned

Institutional

Fiduciary

Trust

-

Money

Market

Portfolio,

2.42%

.

$466,904

$19,030,415

$(19,025,969)

$—

$—

$471,350

471,350

$8,731

Total

Affiliated

Securities

...

$4,352,049

$76,941,046

$(78,073,333)

$—

$—

$3,219,762

$38,421

2. Financial

Instrument

Valuation

(continued)

Templeton

Dragon

Fund,

Inc.

Notes

to

Consolidated

Schedule

of

Investments

(unaudited)

8

Quarterly

Consolidated

Schedule

of

Investments

5.

Investments

in

Templeton

China

Opportunities

Fund,

Ltd.

(China

Fund)  

The

Fund

invests

in

certain

China

A-shares

through

its

investment

in

the

China

Fund.

The

China

Fund

is

a

Cayman

Islands

exempted

company,

and

is

a

wholly-owned

subsidiary

of

the

Fund,

and

is

able

to

invest

directly

in

China

A-shares

consistent

with

the

investment

objective

of

the

Fund.

At September

30,

2022,

the

China

Fund’s

investments

as

well

as

any

other

assets

and

liabilities

of

the

China

Fund

are

reflected

in

the

Fund’s

Consolidated Schedule

of

Investments.

At

September

30,

2022, the

net

assets

of

the

China

Fund

were

$177,821,776,

representing

49.5%

of

the

Fund’s

consolidated

net

assets.

The

China

Fund

gains

access

to

the

A-shares

market

through

Templeton

Investment

Counsel,

LLC

(TIC),

which

serves

as

the

registered

Qualified

Foreign

Institutional

Investor

(QFII)

for

the

China

Fund.

Investment

decisions

related

to

the

China

Fund

A-shares

are

specific

to

the

Fund

and

it

bears

the

resultant

economic

and

tax

consequences

of

its

holdings

and

transactions

in

A-shares.

The

China

Fund

is

subject

to

certain

restrictions

and

administrative

processes

relating

to

its

ability

to

repatriate

cash

balances,

investment

proceeds,

and

earnings

associated

with

its

A-shares

and

may

incur

substantial

delays

in

gaining

access

to

its

assets

or

a

loss

of

value

in

the

event

of

noncompliance

with

applicable

Chinese

rules

or

requirements. 

6. Fair

Value

Measurements 

The

Fund

follows

a

fair

value

hierarchy

that

distinguishes

between

market

data

obtained

from

independent

sources

(observable

inputs)

and

the

Fund's

own

market

assumptions

(unobservable

inputs).

These

inputs

are

used

in

determining

the

value

of

the

Fund's

financial

instruments

and

are

summarized

in

the

following

fair

value

hierarchy:

•

Level

1

–

quoted

prices

in

active

markets

for

identical

financial

instruments

•

Level 2

–

other

significant

observable

inputs

(including

quoted

prices

for

similar

financial

instruments,

interest

rates,

prepayment

speed,

credit

risk,

etc.)

•

Level 3

–

significant

unobservable

inputs

(including

the

Fund's own

assumptions

in

determining

the

fair

value

of

financial

instruments)

The

input

levels

are

not

necessarily

an

indication

of

the

risk

or

liquidity

associated

with

financial

instruments

at

that

level.

A

summary

of

inputs

used

as

of

September

30,

2022,

in

valuing

the

Fund's

assets

carried

at

fair

value,

is

as

follows:

Level

1

Level

2

Level

3

Total

Templeton

Dragon

Fund,

Inc.

Assets:

Investments

in

Securities:

Common

Stocks

:

Air

Freight

&

Logistics

...................

$

—

$

5,061,478

$

—

$

5,061,478

Auto

Components

......................

—

3,484,872

—

3,484,872

Automobiles

..........................

2,549,615

6,941,848

—

9,491,463

Banks

...............................

—

21,174,451

—

21,174,451

Beverages

...........................

—

23,491,757

—

23,491,757

Biotechnology

.........................

805,581

6,514,495

—

7,320,076

Capital

Markets

........................

—

7,093,174

—

7,093,174

Chemicals

...........................

—

13,878,790

—

13,878,790

Construction

Materials

..................

—

8,259,009

—

8,259,009

Containers

&

Packaging

.................

—

3,859,822

—

3,859,822

Electrical

Equipment

....................

—

18,458,683

—

18,458,683

Electronic

Equipment,

Instruments

&

Components

........................

—

4,754,294

—

4,754,294

Entertainment

.........................

513,128

8,787,770

—

9,300,898

Food

&

Staples

Retailing

.................

—

3,466,716

—

3,466,716

Food

Products

........................

—

4,241,322

—

4,241,322

Health

Care

Equipment

&

Supplies

.........

—

7,071,422

—

7,071,422

Templeton

Dragon

Fund,

Inc.

Notes

to

Consolidated

Schedule

of

Investments

(unaudited)

9

Quarterly

Consolidated

Schedule

of

Investments

A

reconciliation

in

which

Level

3

inputs

are

used

in

determining

fair

value

is

presented

when

there

are

significant

Level

3

assets

and/or

liabilities

at

the

beginning

and/or

end

of

the

period.

Abbreviations

Level

1

Level

2

Level

3

Total

Templeton

Dragon

Fund,

Inc.

(continued)

Assets:

(continued)

Investments

in

Securities:

Common

Stocks:

Health

Care

Providers

&

Services

..........

$

—

$

6,234,780

$

—

$

6,234,780

Hotels,

Restaurants

&

Leisure

.............

5,115,332

—

—

5,115,332

Household

Durables

....................

—

15,440,579

—

15,440,579

Insurance

............................

—

2,826,238

—

2,826,238

Interactive

Media

&

Services

..............

5,590,292

27,788,012

—

33,378,304

Internet

&

Direct

Marketing

Retail

..........

—

47,179,075

—

47,179,075

IT

Services

...........................

2,803,560

—

—

2,803,560

Life

Sciences

Tools

&

Services

............

—

16,764,026

—

16,764,026

Machinery

............................

—

12,760,219

—

12,760,219

Media

...............................

—

1,538,656

—

1,538,656

Metals

&

Mining

.......................

—

2,529,867

—

2,529,867

Pharmaceuticals

.......................

—

1,490,197

117,075

1,607,272

Professional

Services

...................

—

2,023,145

—

2,023,145

Real

Estate

Management

&

Development

....

—

3,794,969

—

3,794,969

Semiconductors

&

Semiconductor

Equipment

.

3,525,998

19,681,570

—

23,207,568

Software

.............................

—

2,432,423

—

2,432,423

Specialty

Retail

........................

—

9,507,423

—

9,507,423

Textiles,

Apparel

&

Luxury

Goods

..........

—

11,652,229

—

11,652,229

Transportation

Infrastructure

..............

—

2,431,459

—

2,431,459

Convertible

Bonds

:

Electrical

Equipment

....................

—

536,448

—

536,448

Electronic

Equipment,

Instruments

&

Components

........................

91,111

—

—

91,111

Semiconductors

&

Semiconductor

Equipment

.

—

169,967

—

169,967

Short

Term

Investments

...................

3,219,762

—

—

3,219,762

Total

Investments

in

Securities

...........

$24,214,379

$333,321,185

a

$117,075

$357,652,639

a

Includes

foreign

securities

valued

at

$332,614,770,

which

were

categorized

as

Level

2

as

a

result

of

the

application

of

market

level

fair

value

procedures.

See

the

Financial

Instrument

Valuation

note

for

more

information.

Currency

CNY

Chinese

Yuan

Selected

Portfolio

ADR

American

Depositary

Receipt

FRN

Floating

Rate

Note

6. Fair

Value

Measurements 

(continued)

For

additional

information

on

the

Fund's

significant

accounting

policies,

please

refer

to

the Fund's

most

recent

semiannual

or

annual

shareholder

report.