UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

FORM N-Q

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file number

811-22202

 

Morgan Stanley Frontier Emerging Markets Fund, Inc.

(Exact name of registrant as specified in charter)

 

522 Fifth Avenue, New York, New York

 

10036

(Address of principal executive offices)

 

(Zip code)

 

Arthur Lev

522 Fifth Avenue, New York, New York 10036

(Name and address of agent for service)

 

Registrant’s telephone number, including area code:

212-296-6990

 

 

Date of fiscal year end:

October 31, 2012

 

 

Date of reporting period:

January 31, 2012

 

 


 

Item 1.  Schedule of Investments.

 

The Fund’s schedule of investments as of the close of the reporting period prepared pursuant to Rule 12-12 of Regulation S-X is as follows:

 


 

Morgan Stanley Frontier Emerging Markets Fund, Inc.

Portfolio of Investments

First Quarter Report

January 31, 2012 (unaudited)

 

 

 

Shares

 

Value
(000)

 

Common Stocks (80.6%)

 

 

 

 

 

Argentina (7.0%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Banco Macro SA ADR

 

63,000

 

$

1,559

 

 

 

 

 

 

 

Diversified Telecommunication Services

 

 

 

 

 

Telecom Argentina SA ADR

 

83,400

 

1,747

 

 

 

 

 

 

 

Oil, Gas & Consumable Fuels

 

 

 

 

 

YPF SA ADR

 

69,100

 

2,418

 

 

 

 

 

5,724

 

Bangladesh (2.3%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Islami Bank Bangladesh Ltd. (a)

 

53,280

 

30

 

 

 

 

 

 

 

Pharmaceuticals

 

 

 

 

 

Renata Ltd.

 

123,798

 

1,485

 

 

 

 

 

 

 

Textiles, Apparel & Luxury Goods

 

 

 

 

 

Apex Adelchi Footwear Ltd.

 

73,134

 

211

 

 

 

 

 

 

 

Wireless Telecommunication Services

 

 

 

 

 

GrameenPhone Ltd.

 

91,056

 

168

 

 

 

 

 

1,894

 

Kazakhstan (3.8%)

 

 

 

 

 

Metals & Mining

 

 

 

 

 

Eurasian Natural Resources Corp. PLC

 

194,597

 

2,117

 

Kazakhmys PLC

 

54,400

 

974

 

 

 

 

 

3,091

 

Kenya (1.7%)

 

 

 

 

 

Beverages

 

 

 

 

 

East African Breweries Ltd.

 

693,532

 

1,364

 

 

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Equity Bank Ltd.

 

277,000

 

58

 

 

 

 

 

1,422

 

Kuwait (7.8%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Burgan Bank SAK (a)

 

2,021,597

 

3,350

 

 

 

 

 

 

 

Wireless Telecommunication Services

 

 

 

 

 

National Mobile Telecommunication Co. KSC

 

429,281

 

3,093

 

 

 

 

 

6,443

 

 


 

 

 

Shares

 

Value
(000)

 

Lebanon (0.1%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Banque Audi sal-Audi Saradar Group GDR

 

13,199

 

$

78

 

 

 

 

 

 

 

Macau (2.2%)

 

 

 

 

 

Hotels, Restaurants & Leisure

 

 

 

 

 

Galaxy Entertainment Group Ltd. (a)(b)

 

813,000

 

1,774

 

 

 

 

 

 

 

Mongolia (1.1%)

 

 

 

 

 

Metals & Mining

 

 

 

 

 

Mongolian Mining Corp. (a)(b)

 

1,083,900

 

872

 

 

 

 

 

 

 

Nigeria (14.3%)

 

 

 

 

 

Beverages

 

 

 

 

 

Nigerian Breweries PLC

 

4,100,673

 

2,418

 

 

 

 

 

 

 

Commercial Banks

 

 

 

 

 

First Bank of Nigeria PLC

 

19,991,883

 

1,228

 

Guaranty Trust Bank PLC

 

34,487,504

 

2,993

 

 

 

 

 

4,221

 

Construction Materials

 

 

 

 

 

Dangote Cement PLC

 

1,235,196

 

913

 

 

 

 

 

 

 

Household Products

 

 

 

 

 

PZ Cussons PLC

 

251,942

 

1,212

 

 

 

 

 

 

 

Oil, Gas & Consumable Fuels

 

 

 

 

 

Oando PLC

 

13,335,843

 

1,488

 

Afren PLC (a)

 

814,436

 

1,546

 

 

 

 

 

3,034

 

 

 

 

 

11,798

 

Qatar (17.5%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Qatar National Bank SAQ

 

93,687

 

3,424

 

 

 

 

 

 

 

Diversified Telecommunication Services

 

 

 

 

 

Qatar Telecom Q-Tel QSC

 

51,180

 

2,052

 

 

 

 

 

 

 

Energy Equipment & Services

 

 

 

 

 

Gulf International Services OSC

 

239,800

 

1,495

 

 

 

 

 

 

 

Industrial Conglomerates

 

 

 

 

 

Industries Qatar QSC

 

89,292

 

3,203

 

 

 

 

 

 

 

Insurance

 

 

 

 

 

Qatar Insurance Co.

 

71,411

 

1,628

 

 


 

 

 

Shares

 

Value
(000)

 

Multi-Utilities

 

 

 

 

 

Qatar Electricity & Water Co.

 

66,648

 

$

2,584

 

 

 

 

 

14,386

 

Romania (3.0%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Banca Transilvania (a)

 

3,484,887

 

1,070

 

 

 

 

 

 

 

Diversified Financial Services

 

 

 

 

 

SC Fondul Proprietatea SA

 

8,980,552

 

1,377

 

 

 

 

 

2,447

 

Slovenia (2.1%)

 

 

 

 

 

Pharmaceuticals

 

 

 

 

 

Krka dd Novo mesto

 

26,788

 

1,770

 

 

 

 

 

 

 

Sri Lanka (5.1%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Commercial Bank of Ceylon PLC

 

1,718,416

 

1,580

 

 

 

 

 

 

 

Industrial Conglomerates

 

 

 

 

 

John Keells Holdings PLC

 

1,009,940

 

1,501

 

 

 

 

 

 

 

Wireless Telecommunication Services

 

 

 

 

 

Dialog Axiata PLC

 

18,347,188

 

1,127

 

 

 

 

 

4,208

 

Ukraine (1.3%)

 

 

 

 

 

Food Products

 

 

 

 

 

Milkiland N.V. (a)

 

209,578

 

1,036

 

 

 

 

 

 

 

Oil, Gas & Consumable Fuels

 

 

 

 

 

Sadovaya Group SA (a)

 

13,334

 

37

 

 

 

 

 

1,073

 

United Arab Emirates (8.8%)

 

 

 

 

 

Air Freight & Logistics

 

 

 

 

 

Aramex Co.

 

6,438,219

 

3,102

 

 

 

 

 

 

 

Commercial Banks

 

 

 

 

 

First Gulf Bank

 

409,500

 

1,912

 

 

 

 

 

 

 

Real Estate Management & Development

 

 

 

 

 

Emaar Properties PJSC

 

2,954,000

 

2,204

 

 

 

 

 

7,218

 

 


 

 

 

Shares

 

Value
(000)

 

United Kingdom (2.5%)

 

 

 

 

 

Pharmaceuticals

 

 

 

 

 

Hikma Pharmaceuticals PLC

 

180,168

 

$

2,039

 

Total Common Stocks (Cost $68,881)

 

 

 

66,237

 

 

 

 

 

 

 

Participation Notes (15.6%)

 

 

 

 

 

Luxembourg (2.8%)

 

 

 

 

 

Food Products

 

 

 

 

 

Almarai Co. Ltd., expires 3/24/14 (a)

 

82,873

 

2,254

 

 

 

 

 

 

 

Saudi Arabia (10.5%)

 

 

 

 

 

Commercial Banks

 

 

 

 

 

Alinma Bank, expires 12/3/12 (a)

 

266,314

 

713

 

Riyadh Bank, expires 2/29/12 (a)

 

308,684

 

1,938

 

 

 

 

 

2,651

 

Food & Staples Retailing

 

 

 

 

 

Herfy Food Services Co., expires 12/1/14 (a)

 

8,477

 

206

 

 

 

 

 

 

 

Metals & Mining

 

 

 

 

 

Saudi Arabian Mining Co., expires 6/25/12 (a)

 

297,914

 

2,304

 

 

 

 

 

 

 

Wireless Telecommunication Services

 

 

 

 

 

Etihad Etisalat Co., expires 12/3/12 (a)

 

222,963

 

3,478

 

 

 

 

 

8,639

 

United Arab Emirates (2.3%)

 

 

 

 

 

Wireless Telecommunication Services

 

 

 

 

 

Emirates Telecom, expires 4/14/14 (a)

 

733,145

 

1,892

 

Total Participation Notes (Cost $11,975)

 

 

 

12,785

 

 

 

 

 

 

 

Short-Term Investment (2.4%)

 

 

 

 

 

Investment Company (2.4%)

 

 

 

 

 

Morgan Stanley Institutional Liquidity Funds - Money Market Portfolio - Institutional Class (c)  (Cost $1,999)

 

1,998,673

 

1,999

 

Total Investments (98.6%) (Cost $82,855) +

 

 

 

81,021

 

Other Assets in Excess of Liabilities (1.4%)

 

 

 

1,149

 

Net Assets (100.0%)

 

 

 

$

82,170

 

 

(a)

 

Non-income producing security.

(b)

 

Security trades on the Hong Kong exchange.

(c)

 

The Fund invests in the Morgan Stanley Institutional Liquidity Funds - Money Market Portfolio - Institutional Class (the “Liquidity Fund”), an open-end management investment company managed by the Adviser. Investment advisory fees paid by the Fund are reduced by an amount equal to the advisory and administrative service fees paid by the Liquidity Fund with respect to assets invested by the Fund in the Liquidity Fund.

 


 

+

 

At January 31, 2012, the U.S. Federal income tax cost basis of investments was approximately $82,855,000 and, accordingly, net unrealized depreciation for U.S. Federal income tax purposes was approximately $1,834,000 of which approximately $9,100,000 related to appreciated securities and approximately $10,934,000 related to depreciated securities.

ADR

 

American Depositary Receipt.

GDR

 

Global Depositary Receipt.

 


 

Fair Value Measurement Information:

 

The following is a summary of the inputs used to value the Fund’s investments as of January 31, 2012. (See Notes to the Portfolio of Investments for further information regarding fair value measurement.)

 

Investment Type

 

Level 1
Unadjusted
quoted
prices
(000)

 

Level 2
Other
significant
observable
inputs
(000)

 

Level 3
Significant
unobservable
inputs
(000)

 

Total
(000)

 

Assets:

 

 

 

 

 

 

 

 

 

Common Stocks

 

 

 

 

 

 

 

 

 

Air Freight & Logistics

 

$

3,102

 

$

—

 

$

—

 

$

3,102

 

Beverages

 

3,782

 

—

 

—

 

3,782

 

Commercial Banks

 

17,282

 

—

 

—

 

17,282

 

Construction Materials

 

913

 

—

 

—

 

913

 

Diversified Financial Services

 

1,377

 

—

 

—

 

1,377

 

Diversified Telecommunication Services

 

3,799

 

—

 

—

 

3,799

 

Energy Equipment & Services

 

1,495

 

—

 

—

 

1,495

 

Food Products

 

1,036

 

—

 

—

 

1,036

 

Hotels, Restaurants & Leisure

 

1,774

 

—

 

—

 

1,774

 

Household Products

 

1,212

 

—

 

—

 

1,212

 

Industrial Conglomerates

 

4,704

 

—

 

—

 

4,704

 

Insurance

 

1,628

 

—

 

—

 

1,628

 

Metals & Mining

 

3,963

 

—

 

—

 

3,963

 

Multi-Utilities

 

2,584

 

—

 

—

 

2,584

 

Oil, Gas & Consumable Fuels

 

5,489

 

—

 

—

 

5,489

 

Pharmaceuticals

 

5,294

 

—

 

—

 

5,294

 

Real Estate Management & Development

 

2,204

 

—

 

—

 

2,204

 

Textiles, Apparel & Luxury Goods

 

211

 

—

 

—

 

211

 

Wireless Telecommunication Services

 

4,388

 

—

 

—

 

4,388

 

Total Common Stocks

 

66,237

 

—

 

—

 

66,237

 

Participation Notes

 

8,543

 

4,242

 

—

 

12,785

 

Short-Term Investment - Investment Company

 

1,999

 

—

 

—

 

1,999

 

Total Assets

 

$

76,779

 

$

4,242

 

$

—

 

$

81,021

 

 

Transfers between investment levels may occur as the markets fluctuate and/or the availability of data used in an investment’s valuation changes. The Fund recognizes transfers between the levels as of the end of the period. As of January 31, 2012, securities with a total value of approximately $46,258,000 transferred from Level 2 to Level 1. At October 31, 2011, the fair market value of certain securities were adjusted due to developments which occurred between the time of the close of the foreign markets on which they trade and the close of business on the NYSE which resulted in their Level 2 classification.

 


 

Morgan Stanley Frontier Emerging Markets Fund, Inc.

 

Notes to the Portfolio of Investments · January 31, 2012 (unaudited)

 

Security Valuation: Securities listed on a foreign exchange are valued at their closing price except as noted below. Unlisted securities and listed securities not traded on the valuation date for which market quotations are readily available are valued at the mean between the current bid and ask prices. Equity securities listed on a U.S. exchange are valued at the latest quoted sales price on the valuation date. Equity securities listed or traded on NASDAQ, for which market quotations are available, are valued at the NASDAQ Official Closing Price. Short-term debt securities purchased with remaining maturities of 60 days or less are valued at amortized cost, unless the Board of Directors (the “Directors”) determines such valuation does not reflect the securities’ fair value, in which case these securities will be valued at their fair value as determined in good faith under procedures adopted by the Directors.

 

All other securities and investments for which market values are not readily available, including restricted securities, and those securities for which it is inappropriate to determine prices in accordance with the aforementioned procedures, are valued at fair value as determined in good faith under procedures adopted by the Directors, although the actual calculations may be done by others. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, or the appropriate stock exchange (for exchange-traded securities), analysis of the issuer’s financial statements or other available documents and, if necessary, available information concerning other securities in similar circumstances.

 

Most foreign markets close before the New York Stock Exchange (“NYSE”). Occasionally, developments that could affect the closing prices of securities and other assets may occur between the times at which valuations of such securities are determined (that is, close of the foreign market on which the securities trade) and the close of business on the NYSE. If these developments are expected to materially affect the value of the securities, the valuations may be adjusted to reflect the estimated fair value as of the close of the NYSE, as determined in good faith under procedures established by the Directors.

 

Fair Value Measurement: Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosure” (“ASC 820”), defines fair value as the value that the Funds would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. ASC 820 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in valuing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in valuing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Funds’ investments. The inputs are summarized in the three broad levels listed below.

 

·                   Level 1 — unadjusted quoted prices in active markets for identical investments

 

·                   Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

 

·                   Level 3 — significant unobservable inputs including the Fund’s own assumptions in determining the fair value of investments. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, or the appropriate stock exchange (for exchange-traded securities), analysis of the issuer’s financial statements or other available documents and, if necessary, available information concerning other securities in similar circumstances

 


 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities and the determination of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each security.

 


 

Item 2.    Controls and Procedures.

 

(a) The Fund’s principal executive officer and principal financial officer have concluded that the Fund’s disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Fund in this Form N-Q was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, based upon such officers’ evaluation of these controls and procedures as of a date within 90 days of the filing date of the report.

 

(b) There were no changes in the Fund’s internal control over financial reporting that occurred during the registrant’s fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Fund’s internal control over financial reporting.

 

Item 3.    Exhibits.

 

(a) A separate certification for each principal executive officer and principal financial officer of the registrant are attached hereto.

 


 

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.

 

Morgan Stanley Frontier Emerging Markets Fund, Inc.

 

/s/ Arthur Lev

 

Arthur Lev

Principal Executive Officer

March 22, 2012

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

/s/ Arthur Lev

 

Arthur Lev

Principal Executive Officer

March 22, 2012

 

/s/ Francis Smith

 

Francis Smith

Principal Financial Officer

March 22, 2012

 

Morgan Stanley Frontier Emerging Markets Fund, (NYSE:FFD)
Historical Stock Chart
From Apr 2024 to May 2024 Click Here for more Morgan Stanley Frontier Emerging Markets Fund, Charts.
Morgan Stanley Frontier Emerging Markets Fund, (NYSE:FFD)
Historical Stock Chart
From May 2023 to May 2024 Click Here for more Morgan Stanley Frontier Emerging Markets Fund, Charts.