Are Mid East Portfolio Management Ltd latest results good or bad?

Mid East Portfolio Management Ltd's latest financial results for Q2 FY26 reveal significant operational challenges. The company reported a net profit of ₹0.15 crores, which, while positive, represents a substantial decline of 87.70% from the previous quarter's ₹1.22 crores. This profit was primarily driven by other income of ₹0.21 crores, which surged by 600% from ₹0.03 crores in Q1 FY26. However, when excluding this non-operating income, the company faced an operating loss of ₹0.07 crores, marking a record low and highlighting a troubling dependency on volatile income sources. The financial performance reflects a stark deterioration in core operations, as the company has consistently reported operating losses in six out of the last seven quarters. The absence of reported net sales raises questions about the sustainability of the business model and revenue recognition practices. Employee costs remain low, but the overall financial structure shows a negative reserves account of ₹-1.40 crores, indicating accumulated losses that have eroded shareholder value. The company's return on equity (ROE) appears misleadingly high at 44.90% due to a very small equity base, while the five-year average ROE of 6.04% suggests long-term profitability challenges. Moreover, the return on capital employed (ROCE) stands at -2.87%, indicating that the business is not generating returns above its cost of capital. In terms of shareholding, there has been a notable decline in promoter ownership, dropping from 39.26% in December 2024 to 16.19% in September 2025, signaling a lack of confidence from insiders. The stock has delivered impressive returns over the past year, but these gains appear disconnected from the underlying fundamentals, which have shown significant deterioration. Overall, Mid East Portfolio Management Ltd's results indicate a company grappling with fundamental weaknesses in its business model, characterized by reliance on non-operating income, persistent operating losses, and a concerning decline in promoter confidence. The company saw an adjustment in its evaluation, reflecting these ongoing challenges.