Midwest Energy Q2 loss widens to Rs 6.37 crore on costs

Midwest Energy Limited reported a consolidated loss of Rs 6.37 crore for the quarter ended September 30, 2026, compared with a Rs 3.52 crore loss a year earlier, as total expenses reached Rs 21.52 crore and exceeded total income of Rs 15.14 crore. Revenue from operations rose to Rs 13.81 crore from Rs 1.20 crore.

Why did Midwest Energy report a wider Q2 loss?

Midwest Energy reported a wider quarterly loss because expenses increased more than income in the quarter ended September 30, 2026. Revenue from operations increased by Rs 12.61 crore year on year to Rs 13.81 crore, while other income rose to Rs 1.33 crore from Rs 21.11 lakh. That took total income to Rs 15.14 crore, against Rs 1.41 crore in the September 2025 quarter.

Total expenses rose by Rs 16.58 crore to Rs 21.52 crore from Rs 4.94 crore a year earlier. The loss before tax and loss after tax were each Rs 6.37 crore because the consolidated statement recorded neither exceptional items nor tax expense for the quarter. The loss attributable to Midwest Energy shareholders was Rs 5.87 crore, while non-controlling interests accounted for Rs 50.29 lakh.

Sequentially, the September-quarter loss widened from Rs 1.02 crore in the quarter ended June 30, 2026. Total income was Rs 7.91 crore in the June quarter and total expenses were Rs 8.93 crore, compared with Rs 15.14 crore of income and Rs 21.52 crore of expenses in the September quarter.

Which costs increased for Midwest Energy in Q2?

Midwest Energy's largest stated cost in the September 2026 quarter was raw-material consumption of Rs 9.18 crore. Employee-benefit expense rose to Rs 3.53 crore from Rs 84.49 lakh in the September 2025 quarter, while purchases of stock in trade were Rs 1.79 crore and inventory changes represented an expense of Rs 70.24 lakh.

Finance costs rose to Rs 2.42 crore from Rs 84.49 lakh a year earlier, while depreciation expense was Rs 1.83 crore against Rs 85.20 lakh. Other expenses increased to Rs 2.07 crore from Rs 1.72 crore. These expense lines, together with raw-material consumption, contributed to total expenditure exceeding quarterly income by Rs 6.37 crore.

The loss per equity share was Rs 0.40 for the September 2026 quarter, compared with Rs 0.29 in the corresponding prior-year quarter. Midwest Energy said earnings-per-share figures for all periods presented were adjusted for a share split from Rs 10 to Rs 1 per equity share, effective September 25, 2026. Paid-up equity share capital was Rs 12.97 crore at September 30, 2026, compared with Rs 11.05 crore a year earlier.

Which Midwest Energy segment generated the most revenue?

Midwest Energy's renewable energy and power storage systems segment generated Rs 13.18 crore of revenue in the September 2026 quarter, compared with Rs 1.31 crore in the September 2025 quarter. The segment supplied most of the group's Rs 13.81 crore revenue from operations. The others segment contributed Rs 63.65 lakh, while the filing did not report quarterly revenue for rare-earth materials and magnets.

The renewable energy and power storage systems segment recorded a Rs 4.73 lakh segment result, compared with a Rs 2.63 crore loss a year earlier. Its result was lower than the Rs 3.63 crore segment profit reported in the June 2026 quarter. Rare-earth materials and magnets posted a Rs 7.22 lakh segment loss, while the others segment reported a Rs 1.02 crore loss; segment results are before unallocable expenditure and finance costs.

For the six months ended September 30, 2026, renewable energy and power storage systems revenue was Rs 17.81 crore, versus Rs 1.69 crore in the corresponding prior-year period. Its segment result was Rs 3.67 crore, compared with a Rs 5.64 crore loss. At group level, finance costs of Rs 3.71 crore and unallocable expenditure of Rs 5.48 crore contributed to a first-half loss before tax of Rs 7.39 crore.

How did Midwest Energy's assets and cash flows change?

Midwest Energy's total assets increased to Rs 767.16 crore at September 30, 2026 from Rs 713.96 crore at March 31, 2026. Non-current assets rose to Rs 606.43 crore from Rs 455.49 crore, including property, plant and equipment of Rs 146.51 crore and other assets of Rs 222.24 crore. Current assets declined to Rs 160.73 crore from Rs 258.46 crore.

Cash and cash equivalents fell to Rs 18.06 crore at September 30 from Rs 126.76 crore at March 31. The group reported a net operating cash outflow of Rs 47.57 crore for the six months ended September 30, 2026, compared with an outflow of Rs 16.57 crore in the prior-year period. Inventories absorbed Rs 35.43 crore and trade receivables and other assets absorbed Rs 13.38 crore.

Net investing cash outflow increased to Rs 113.50 crore from Rs 54.92 crore in the prior-year six months. Midwest Energy reported Rs 56.02 crore spent on property, plant and equipment and capital work-in-progress, and Rs 83.81 crore of capital advances. Financing activities generated Rs 52.37 crore, including Rs 35.35 crore of current borrowings and Rs 11.24 crore of non-current borrowings.

What did Midwest Energy disclose about funding and review?

Midwest Energy said it continued to use proceeds from preferential equity allotments for approved purposes during the quarter ended September 30, 2026. From the Rs 150 crore issue completed in December 2025, unutilised funds were Rs 6.29 crore at September 30. A separate preferential issue that raised Rs 184.85 crore had Rs 24.30 crore unutilised at the same date.

The second issue earmarked Rs 80 crore for repayment of unsecured loans or advances from directors, Rs 60 crore for land or buildings for a proposed rare-earth magnet manufacturing facility, Rs 50 crore for plant, equipment and machinery, and Rs 10 crore for general corporate requirements. During July to September 2026, Midwest Energy disclosed Rs 2.39 crore of utilisation, including Rs 2.30 crore of advances for plant and machinery and Rs 8.54 lakh for land and building purchase.

The independent auditor reviewed the unaudited consolidated results for the quarter and six months ended September 30, 2026 and said nothing had come to its attention to indicate a material misstatement. The review included unaudited information from two foreign subsidiaries and step-down subsidiaries with total assets of Rs 31.04 crore, nil revenue and a quarterly net loss of Rs 98.18 lakh; management stated these entities were not material to the group.

Conclusion

Midwest Energy's September-quarter filing shows that sharply higher revenue, principally from renewable energy and power storage systems, did not offset increased raw-material, employee, finance, depreciation and other costs. The resulting Rs 6.37 crore quarterly loss was larger than the Rs 3.52 crore loss a year earlier, while the first-half loss before tax was Rs 7.39 crore against Rs 7.30 crore in the prior-year period.

Next, readers can watch Midwest Energy's use of Rs 24.30 crore and Rs 6.29 crore of remaining preferential-issue proceeds, particularly expenditure connected with the proposed rare-earth magnet manufacturing facility. Subsequent disclosures will also show whether revenue from renewable energy and power storage systems, which reached Rs 17.81 crore in the first half, can cover unallocable expenditure and finance costs.