Item 1. Schedule of Investments

Japan Smaller Capitalization Fund, Inc.

May 31, 2018 (Unaudited)

Fair    

JAPANESE EQUITY SECURITIES

Banks

Fukuoka Financial Group, Inc.

365,000

$

1,953,919

General banking services

The Akita Bank, Ltd.

127,800

3,491,225

General banking services

The Bank of Okinawa, Ltd.

49,700

1,935,978

General banking services

The Keiyo Bank, Ltd.

450,000

2,015,728

General banking services

The Musashino Bank, Ltd.

70,400

2,246,946

General banking services

The Taiko Bank, Ltd.

96,500

1,963,374

General banking services

The Yamanashi Chuo Bank, Ltd.

460,000

1,878,587

General banking services

Total Banks (4.0%)

15,485,757

Chemicals

Adeka Corporation

215,300

3,887,362

Manufactures chemical and food products

C. Uyemura &  Co., Ltd.

49,800

3,536,203

Plating chemicals

Fujikura Kasei Co., Ltd.

999,300

6,406,476

Specialty coating materials and fine chemicals

Koatsu Gas Kogyo Co., Ltd.

600,200

5,283,217

High-pressured gases and chemicals

Sakata Inx Corporation

652,700

9,209,362

Manufactures printing ink

Sekisui Jushi Corporation

204,200

4,269,192

Manufactures plastics and other resin materials

Shikoku Chemicals Corporation

92,900

1,298,823

Manufactures chemical products

Tenma Corporation

353,900

6,194,552

Manufactures synthetic resin products

T&K Toka Co., Ltd.

168,600

1,891,943

Manufactures specialized inks for printing applications

Yushiro Chemical Industry Co., Ltd.

230,600

3,463,666

Manufactures metalworking fluids

Total Chemicals (11.6%)

45,440,796

Construction

Toenec Corporation

315,900

9,661,217

Construction of comprehensive building facilities

Totetsu Kogyo Co., Ltd.

239,200

7,568,506

Operates construction-related businesses

Yondenko Corporation

61,600

1,553,598

Construction of electrical distribution systems

Yurtec Corporation

265,400

2,165,285

Engineering company

Total Construction (5.4%)

20,948,606

Electric Appliances

Kitagawa Industries Co., Ltd.

280,500

3,637,831

Manufactures various industrial and consumer products

Koito Manufacturing Co., Ltd.

26,600

1,959,768

Manufactures lighting equipment

Mabuchi Motor Co., Ltd.

81,900

3,804,222

Manufactures small motors

Maxell Holdings, Ltd.

77,400

1,275,762

Manufactures media devices, batteries and electrical appliances

Total Electric Appliances (2.7%)

10,677,583

Financing Business

Hitachi Capital Corporation

130,000

3,373,160

General financial services

Ricoh Leasing Company, Ltd.

131,800

4,400,607

Leasing and financial services

Total Financing Business (2.0%)

7,773,767

Food

Japan Meat Co., Ltd.

105,900

2,270,538

Supermarket business and operation of eating-out stores

Kameda Seika Co., Ltd.

92,300

4,991,943

Manufactures confectioneries

Total Food (1.9%)

7,262,481

Information and Communication

NS Solutions Corporation

98,400

2,681,744

System consulting services and software development

OBIC Co., Ltd.

23,700

2,053,477

Computer system integration

Okinawa Cellular Telephone Company

234,900

9,312,169

Telecommunications

Otsuka Corporation

49,900

2,063,102

Computer information system developer

Total Information and Communication (4.1%)

16,110,492

Iron and Steel

Chubu Steel Plate Co., Ltd.

237,800

1,640,453

Manufactures steel-related products

Mory Industries Inc.

40,100

1,237,449

Manufactures steel tubing products

Nichia Steel Works, Ltd.

2,058,600

6,324,249

Manufactures steel-related products

Osaka Steel Co., Ltd.

468,800

9,443,267

Manufactures steel-related products

Total Iron and Steel (4.8%)

18,645,418

Machinery

Hisaka Works, Ltd.

378,200

3,763,911

Manufactures heat exchangers and other machinery

Miura Co., Ltd.

71,000

1,888,631

Manufactures boilers and related products

Nippon Pillar Packing Co., Ltd.

102,400

1,542,781

Manufactures mechanical seals

Nitto Kohki Co., Ltd.

154,700

3,804,891

Manufactures machine tools and motor pumps

Oiles Corporation

494,480

10,574,559

Manufactures bearing equipment

Shibuya Corporation

15,300

514,363

Packing plant business

Star Micronics Co., Ltd.

12,200

205,129

Manufactures machinery and tools, electronic components, and precision parts

Yamashin-Filter Corporation

50,000

568,893

Manufactures filters

Total Machinery (5.9%)

22,863,158

Metal Products

Dainichi Co., Ltd.

246,100

1,828,999

Manufactures oil heating equipment

Neturen Co., Ltd.

408,800

3,726,277

Manufactures steel bars and induction heating equipment

NHK Spring Co., Ltd.

304,300

3,003,255

Manufactures automobile-related products

Piolax, Inc.

139,000

3,517,191

Manufactures automobile-related products

Rinnai Corporation

51,100

4,888,153

Manufactures heating appliances and components

Shinpo Co., Ltd.

1,800

26,904

Manufactures smokeless roasters

Total Metal Products (4.3%)

16,990,779

Other Products

Fuji Seal International, Inc.

63,600

2,506,678

Packaging-related materials and machinery

Komatsu Wall Industry Co., Ltd.

20,300

421,423

Manufactures various partitions

Nishikawa Rubber Co., Ltd.

182,800

4,075,673

Manufactures rubber automobile parts

Pigeon Corporation

43,600

2,145,511

Manufactures baby care products

The Pack Corporation

189,000

6,597,268

Manufactures paper and chemical products

Total Other Products (4.0%)

15,746,553

Precision Instruments

Nakanishi Inc.

103,200

2,183,223

Manufactures dental instruments

Total Precision Instruments (0.6%)

2,183,223

Real Estate

Daibiru Corporation

170,400

1,824,371

Real estate leasing and building management

Sanyo Housing Nagoya Co., Ltd.

269,500

3,036,585

Designs and constructs housing

Starts Corporation Inc.

76,400

1,960,596

Construction, leasing and management of real estate

Total Real Estate (1.7%)

6,821,552

Retail Trade

ABC-Mart, Inc.

103,100

6,353,661

Retail sales of shoes

AIN Holdings Inc.

2,700

191,225

Operates pharmacies and drug store chains

Amiyaki Tei Co., Ltd.

222,700

10,426,260

Operates barbecue restaurant chains

Cosmos Pharmaceutical Corporation

26,500

5,718,267

Operates drug stores

Create SD Holdings Co., Ltd.

289,600

8,643,782

Operates pharmacies and drug store chains

Daikokutenbussan Co., Ltd.

198,800

10,185,026

Operates supermarkets

Don Quijote Holdings Co., Ltd.

67,800

3,616,998

Operates discount stores

Hiday Hidaka Corp

114,133

2,751,496

Operates restaurant chains

Izumi Co., Ltd.

37,600

2,334,437

Operates shopping centers, real estate business and credit card services

JINS Inc.

30,700

1,716,851

Retail sales of eyewear and fashion accessories

Kura Corporation

14,200

1,078,845

Operates a sushi restaurant chain

Kusuri No Aoki Holdings Co., Ltd.

54,800

4,022,296

Operates drug stores

NAFCO Co., Ltd.

72,900

1,253,891

Operates chain of home and furniture retail outlets

Saint Marc Holdings Co., Ltd.

70,900

1,842,278

Operates restaurant chains

Saizeriya Co., Ltd.

422,300

9,757,336

Operates restaurants

San-A Co., Ltd.

147,300

7,492,357

Retail sales of home goods

Seria Co., Ltd.

56,300

2,723,859

Discount retail sales

Start Today Co., Ltd.

13,600

473,473

Operates retail E-commerce websites

Sundrug Co., Ltd.

24,500

1,115,480

Operates pharmacies and drug store chains

Yossix Co., Ltd.

12,100

405,671

Operates restaurant chains

Total Retail Trade (21.0%)

82,103,489

Services

EPS Holdings, Inc.

73,800

1,464,868

Performs contract medical research services

H.I.S. Co., Ltd.

110,100

3,807,726

Travel business

Nihon M&A Center Inc.

31,200

1,027,373

Provides merger and acquisition brokerage services

Nippon Air Conditioning Services Co., Ltd.

368,300

2,682,980

Provides maintenance and management of building facilities

Step Co., Ltd.

144,500

2,365,802

Operates preparatory schools

Tear Corporation

65,200

631,490

Funeral business

Total Services (3.1%)

11,980,239

Textiles and Apparel

Seiren Co., Ltd.

307,900

5,669,755

Manufactures synthetic fibers and textile products

Total Textiles and Apparel (1.5%)

5,669,755

Transportation and Warehousing

Alps Logistics Co., Ltd.

242,300

2,028,081

General logistics services

Japan Transcity Corporation

836,300

3,892,272

General logistics services

Meiko Trans Co., Ltd.

381,900

4,562,988

Marine logistics services

Trancom Co., Ltd.

52,500

3,940,397

General logistics services

Total Transportation and Warehousing (3.7%)

14,423,738

Transportation Equipment

Hi-Lex Corporation

144,700

3,822,465

Manufactures control cables

Morita Holdings Corporation

72,900

1,470,472

Operates five business transportation segments

Nissin Kogyo Co., Ltd.

49,900

883,990

Manufactures automobile brake systems

Total Transportation Equipment (1.6%)

6,176,927

Utilities

Keiyo Gas Co., Ltd.

486,000

2,847,517

Produces gas and energy products

The Okinawa Electric Power Company, Incorporated

173,477

3,952,378

Produces thermal energy products

Total Utilities (1.7%)

6,799,895

Wholesale Trade

Ai Holdings Corporation

31,900

755,835

Information and security equipment

Kanaden Corporation

328,700

4,365,736

Factory automation business

Kohsoku Corporation

355,100

4,272,174

Food and industrial packaging materials

Kondotec Inc.

44,800

405,063

Manufactures construction materials

Matsuda Sangyo Co., Ltd.

368,300

5,786,023

Precious metals, electronic materials, and food

Nagaileben Co., Ltd.

6,300

165,265

Medical wear business

Paltac Corporation

39,900

2,359,796

Cosmetics and daily necessities

Ryoden Corporation

771,500

12,922,199

Purchases electronic and electrical devices

SIIX Corporation

627,100

12,049,410

Parts procurement, logistics, and manufacturing of electronics

Sugimoto & Co., Ltd.

266,600

4,879,820

Machine tools and measuring instruments

Techno Associe Co., Ltd.

387,400

4,439,849

Screws and nonferrous metal products

Total Wholesale Trade (13.3%)

52,401,170

TOTAL INVESTMENTS IN JAPANESE EQUITY SECURITIES (98.9%) 

$

386,505,378

FOREIGN CURRENCY

Japanese Yen

Interest bearing account

$

2,920,415

TOTAL FOREIGN CURRENCY (0.7%)

2,920,415

TOTAL INVESTMENTS IN JAPANESE EQUITY SECURITIES AND FOREIGN CURRENCY (99.6%)

$

389,425,793

OTHER ASSETS LESS LIABILITIES, NET (0.4%)

1,294,813

NET ASSETS (100%)

$

390,720,606

Portfolio securities and foreign currency holdings were translated

Notes to Schedule of Investments (Unaudited)

Costs for Federal Income Tax Purposes

As of May 31, 2018, for federal income tax purposes, subject to change, the aggregate cost of securities was $335,552,245 and net unrealized appreciation was $50,953,133, comprised of gross unrealized appreciation of $53,635,801 and gross unrealized depreciation of $2,682,668. The aggregate cost of investments for tax purposes will depend upon Japan Smaller Capitalization Fund, Inc.'s (the "Fund") investment experience during the entirety of its fiscal year and may be subject to changes based on tax regulations. Certain tax related calculations are completed and reviewed annually by the Fund.   

Fair Value Measurements

In accordance with United States generally accepted accounting principles ("U.S. GAAP"), fair value is defined as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP also establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund's own assumptions about the assumptions that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation.      

The three-tier hierarchy of inputs is summarized below.

Level 1 - 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)

At May 31, 2018, all of the Fund's investments were determined to be Level 1 securities.