Are MIRC Electronics Ltd latest results good or bad?

MIRC Electronics Ltd's latest financial results for Q2 FY26 reveal a complex picture of operational challenges despite a modest increase in revenue. The company reported net sales of ₹163.31 crores, reflecting a year-on-year growth of 7.89% and a sequential improvement of 15.95%. However, this revenue growth has not translated into profitability, as the company continues to face significant operational losses. The net loss for the quarter amounted to ₹1.78 crores, which represents a stark decline compared to the profit of ₹1.35 crores in the same quarter last year. This indicates a negative year-on-year growth of 231.85%. The operating margin was recorded at -10.59%, marking the lowest performance in seven quarters, and the company has struggled to maintain positive operating profits, posting losses in five of the last seven quarters. Additionally, the return on equity stands at a deeply negative -32.73%, indicating a significant destruction of shareholder value. The interest expense has also risen to ₹5.23 crores, the highest in seven quarters, raising concerns about the company's ability to service its debt given the negative operating profit. Overall, MIRC Electronics Ltd is grappling with structural issues that hinder its ability to convert revenue into profit, alongside a concerning financial position characterized by persistent losses and high operational costs. The company has seen an adjustment in its evaluation, reflecting these ongoing challenges and the broader context of its operational performance.