FORM 10-QSB



    Quarterly Report Under Section 13 or 15(d) of the 
               Securities Exchange Act of 1934

     For the quarterly period ended October 31, 1998

              Commission File No. 2-33256


                       TOROTEL, INC.
     (Exact name of small business issuer as specified
                      in its charter)


          MISSOURI                          44-0610086
(State or other jurisdiction of       (I.R.S. Employer 
 incorporation or organization)    Identification No.)


   13402 SOUTH 71 HIGHWAY, GRANDVIEW, MISSOURI  64030
        (Address of principal executive offices)


                    (816) 761-6314
            (Issuers telephone number)


                        NONE
     (Former name, former address and former fiscal 
          year, if change since last report)


Check whether the issuer (1) filed all reports 
required to be filed by Section 13 or 15(d) of the 
Exchange Act during the past 12 months and (2) has 
been subject to such filing requirements for the past 
90 days.

             Yes    X     No             


As of December 11, 1998, there were 2,811,590 shares 
of Common Stock, $.50 Par Value, outstanding.

















            TOROTEL, INC. AND SUBSIDIARIES



                         INDEX



PART I.     FINANCIAL INFORMATION

     Item 1.     Financial Statements

   Consolidated Balance Sheet as of October 31, 1998 

   Consolidated Statements of Operations for the six 
      months ended October 31, 1998 and 1997 

   Consolidated Statements of Operations for the three 
      months ended October 31, 1998 and 1997 

   Consolidated Statements of Cash Flows for the six 
      months ended October 31, 1998 and 1997 

   Notes to Consolidated Financial Statements 

     Item 2.     Managements Discussion and Analysis
                   or Plan of Operation   



PART II.     OTHER INFORMATION

     Item 1.     Legal Proceedings 

     Item 6.     Exhibits and Reports on Form 8-K  



SIGNATURES
























PART I.     FINANCIAL INFORMATION


Item 1.     Financial Statements

CONSOLIDATED BALANCE SHEET (Unaudited)
As of October 31, 1998


ASSETS

Current assets:
  Cash                                 $      73,000
  Accounts receivable, net                   875,000
  Inventories (Note 3)                     3,047,000
  Prepaid expenses and
   other current assets                      156,000
  Asset held for disposal                     76,000
                                           4,227,000

Property, plant and equipment, net         1,438,000

Other assets                                 105,000

                                         $ 5,770,000

LIABILITIES AND STOCKHOLDERS EQUITY

Current liabilities:
  Short-term revolving credit line
    (Note 5)                             $ 1,203,000
Current maturities of long-term debt         284,000
Trade accounts payable                       654,000
Accrued liabilities                          313,000
                                           2,454,000

Long-term debt, less current maturities    1,479,000

Note and interest payable to former
  officer (Note 6)                           458,000

Commitments and contingencies
  (Notes 6 and 10)                           486,000

Stockholders equity
 (Notes 7, 8, 9 and 10):
  Common stock, at par value                1,441,000
  Capital in excess of par value            8,673,000
Accumulated deficit                        (9,016,000)
                                            1,098,000
Less treasury stock, at cost                  205,000
                                              893,000

                                          $ 5,770,000






The accompanying notes are an integral part of these 
statements.

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Six Months Ended October 31,


                             1998          1997

Net sales               $  4,649,000   $  6,642,000
Cost of goods sold         4,106,000      5,001,000

     Gross profit            543,000      1,641,000

Operating expenses:
Engineering                  417,000        396,000
Selling, general and
   administrative          1,083,000      1,165,000
                           1,500,000      1,561,000

     Earnings (loss)
        from operations     (957,000)        80,000

Other income (expense):
     Interest expense          (169,000)      (133,000)
Other, net (Note 11)         984,000        (71,000)
                             815,000       (204,000)

     Loss before provision
       for income taxes     (142,000)      (124,000)

Provision for income
  taxes (Note 4)               -               -   

Net loss               $    (142,000)   $  (124,000)


Basic loss per share
  (Note 7)                  $ (.05)        $ (.04)

Diluted loss per share
  (Note 7)                  $ (.05)        $ (.04)




















The accompanying notes are an integral part of these 
statements.


CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended October 31,


                                1998         1997

Net sales                $  2,016,000   $  3,265,000
Cost of goods sold          1,744,000      2,550,000

     Gross profit             272,000        715,000

Operating expenses:
  Engineering                 215,000        189,000
  Selling, general and
    administrative            501,000        561,000
                              716,000        750,000

     Loss from operations    (444,000)       (35,000)

Other income (expense):
  Interest expense            (86,000)       (66,000)
  Other, net (Note 11)        984,000         (1,000)
                              898,000        (67,000)

     Earnings (loss) before
      provision for income
      taxes                   454,000       (102,000)

Provision for income taxes
  (Note 4)                       -              - 

Net earnings (loss)        $  454,000      $(102,000)


Basic earnings (loss) per
  share (Note 7)           $  .16          $ (.04)

Diluted earnings (loss) 
 per share (Note 7)        $  .16          $ (.04)






















The accompanying notes are an integral part of these 
statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended October 31,


                                   1998        1997

Cash flows from operating
  activities:
    Net loss                $   (142,000)  $ (124,000)

Adjustments to reconcile net loss to net cash
    provided by operations:
     Gain on sale of product
       line                     (984,000)       -     
Loss from estimated government
  penalty                           -          70,000
Depreciation and amortization    171,000      172,000
Increase (decrease) in cash 
  flows from operations
  resulting from changes in:
    Accounts receivable          689,000      228,000
    Inventories                 (177,000)    (219,000)
    Prepaid expenses and
      other assets              (130,000)     (72,000)
    Trade accounts payable       (41,000)    (107,000)
    Accrued liabilities         (129,000)     (53,000)

Net cash used in operating
  activities                    (743,000)    (105,000)

Cash flows from investing
  activities:
    Capital expenditures         (41,000)     (79,000)
    Proceeds from product line
      sale                     1,250,000         -    

Net cash provided by (used in)
  investing activities         1,209,000      (79,000)

Cash flows from financing
  activities:
    Borrowings against
      credit line              1,692,000      785,000
    Payments against
      credit line             (2,050,000)    (670,000)
    Principal payments
      on long-term debt          (90,000)     (42,000)
    Payments on capital
     lease obligations           (12,000)      (7,000)
    Note and interest payable
      to former officer           20,000       34,000
    Proceeds from issuance
      of common stock              1,000        2,000

Net cash provided by (used in)
  financing activities          (439,000)     102,000

Net increase (decrease)
  in cash                  $      27,000  $  (82,000)
Cash at beginning of year         46,000     196,000

Cash at end of October     $      73,000  $  114,000


Supplemental Disclosures
  of Cash Flow Information
  Cash paid during the period for:
    Interest                   $    150,000  $ 110,000
    Income taxes               $       -     $   -     























































The accompanying notes are an integral part of these 
statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


Note 1 - Basis of Presentation

     The accompanying unaudited consolidated financial 
statements reflect the normal recurring adjustments 
which are, in the opinion of management, necessary to 
present fairly the companys financial position at 
October 31, 1998, and the results of operations for 
the three and six months ended October 31, 1998.
     The financial statements contained herein should 
be read in conjunction with the companys financial 
statements and related notes filed on Form 10-KSB for 
the year ended April 30, 1998.


Note 2 - Realization of Assets

     The accompanying consolidated financial 
statements have been prepared in conformity with 
generally accepted accounting principles, which 
contemplate continuation of the company as a going 
concern.  However, the company has sustained 
substantial operating losses in the first half of 
fiscal 1999, and in fiscal years 1998 and 1997.  In 
addition, in the first half of fiscal 1999 and for 
fiscal year 1998, the company has used, rather than 
provided, cash in its operations.  The companys line 
of credit with Phillipsburg National Bank & Trust 
Company (PNBT) expires January 31, 1999 (see Note 5 of 
Notes to Consolidated Financial Statements).  If the 
bank does not renew the credit line, the entire 
outstanding balance would become due and payable.  
While management believes the bank has an interest in 
continuing as the companys primary lender, renewal of 
the credit line will be subject to, among other 
things, satisfactory review of the companys operating 
plans, cash needs, available collateral, and the 
status of the possible acquisition (see Note 10 of 
Notes to Consolidated Financial Statements).
     In view of the matters described in the preceding 
paragraph, recoverability of a major portion of the 
recorded asset amounts shown in the accompanying 
consolidated balance sheet is dependent upon continued 
operations of the company, which in turn is dependent 
upon the companys ability to meet its financing 
requirements on a continuing basis, to maintain 
present financing, and to succeed in its future 
operations.  The consolidated financial statements do 
not include any adjustment relating to the 
recoverability and classification of recorded asset 
amounts or amounts and classification of liabilities 
that might be necessary should the company be unable 
to continue in existence.


Note 3 - Inventories

     The components of inventories are summarized as 
follows:

          Raw materials             $ 1,690,000
          Work in process              903,000
          Finished goods              454,000

                                                  
$ 3,047,000


Note 4 - Income Taxes

     The company has net operating loss and credit 
carryforwards available as benefits to reduce future 
income taxes, subject to applicable limitations.  
These tax credit and operating loss carryforwards 
expire in various amounts in the years 1999 through 
2013.
     The difference between the financial and tax 
bases of assets and liabilities is determined 
annually.  Deferred income taxes and liabilities are 
computed for those differences that have future tax 
consequences using the currently enacted tax laws and 
rates that apply to the periods in which they are 
expected to effect taxable income.  Valuation 
allowances are established, if necessary, to reduce 
the deferred tax asset to the amount that will, more 
likely than not, be realized.  Income tax expense is 
the current tax payable or refundable for the period 
plus or minus the net change in the deferred tax 
assets or liabilities.
     The following table summarizes the components of 
the net deferred tax asset:

Net operating loss carryforwards         $ 2,305,000
Inventory valuation reserve                  229,000
Tax credit carryforwards                     406,000
Property, plant and equipment                106,000
Other                                         52,000
                                         $ 3,098,000
Less valuation allowance                   3,098,000

                                         $      -


Note 5 - Short-term Revolving Credit Line

     In September 1998, the company renewed its 
revolving credit agreement with PNBT through December 
31, 1998; however, at the time of filing this Form 10-
QSB, the bank has verbally extended this expiration 
date to January 31, 1999.  The credit agreement 
originally provided a $2,500,000 revolving credit 
line; however, this amount was reduced to $1,700,000 
upon closing of the product line sale discussed in 
Note 11 of Notes to Consolidated Financial Statements.
     Advances under the credit line are limited to the 
sum of 75% of eligible billed receivables and 50% of 
inventories, net of reserves.  The revolving credit 
line is collateralized by trade accounts receivable, 
inventories, and a third lien mortgage on OPTs 
facility.  Under the terms of the agreement, the 
outstanding balance of the revolving line bears 
interest at 1/2% over the banks prime lending rate.  
As of October 31, 1998, the company had utilized 
$1,203,000 of the revolving credit line and the 
effective borrowing rate was 8.5%.  The company is 
required to comply with certain covenants including 
restrictions on the payment of cash dividends.  As of 
October 31, 1998, the company was in violation of two 
financial covenants under the terms of the credit 
agreement with PNBT; however, the bank has waived 
compliance with the subject provisions through January 
31, 1999, which is the verbal expiration date of the 
credit line.


Note 6 - Contingency for Estimated Penalty

     On May 6, 1997, Torotel Products, Inc. was 
accepted into the Voluntary Disclosure Program of the 
United States Department of Defense, resulting from 
its failure to perform some required thermal shock 
testing as frequently as required, and inaccurately 
certifying that all required testing had been 
performed.  As a result of the companys investigation 
into the thermal shock deficiencies, which was first 
reported in November 1996, the company recorded an 
estimated charge of $416,000 against earnings in the 
fourth quarter of its fiscal year ended April 30, 
1997.  Because the investigation was ongoing, the 
company subsequently determined that there also were 
some deficiencies in performing some required 
electrical testing as frequently as required.  As a 
result, the company recorded an additional estimated 
charge of $70,000 against earnings in the first 
quarter of its fiscal year ended April 30, 1998.  The 
company does not anticipate incurring any additional 
major charges related to the investigation; however, 
the aggregate amount of the estimated penalty is still 
subject to fluctuation as further evidence is 
investigated.
     At this time, the company is not certain when 
payment of the damage amount will be required; 
however, the company does not anticipate making any 
payments during the next twelve months.  As a result, 
the entire $486,000 has been classified as a long-term 
liability in the accompanying consolidated balance 
sheet.
     The company believes that certain of its former 
officers may have been responsible for the misconduct 
related to the test failures, and will evaluate ways 
of recovering the damages once the government 
completes its investigation.  In the meantime, the 
company has suspended all principal and interest 
payments due under a note payable to a former officer, 
and does not anticipate making any further payments 
during the next twelve months.  As a result, as of 
October 31, 1998, the aggregate amount due of 
$458,000, which consists of the outstanding principal 
of $384,000 plus the accrued interest of $74,000, has 
been classified as a long-term liability in the 
accompanying consolidated balance sheet.
     The legal fees associated with the DOD 
investigation have amounted to $1,000 during the 
current fiscal year, and $272,000 in aggregate since 
the investigation started in the third quarter of the 
fiscal year ended April 30, 1997.


Note 7 - Earnings Per Share

     In February 1997, the FASB issued Statement of 
Financial Accounting Standards (SFAS)
No. 128, Earnings per Share, which replaces the 
presentation of primary earnings per share (EPS) with 
a presentation of basic EPS; requires dual 
presentation of basic and diluted EPS on the face of 
the statement of earnings regardless of whether basic 
and diluted EPS are the same; and requires a 
reconciliation of the numerator and denominator used 
in computing basic and diluted EPS.  Basic EPS 
excludes dilution and is computed by dividing earnings 
available to common stockholders by the weighted 
average number of common shares outstanding for the 
period.  Diluted EPS is computed similarly to fully 
diluted EPS pursuant to APB Opinion 15.  Diluted EPS 
reflects the potential dilution that could occur if 
securities or other contracts to issue common stock 
were exercised or converted into common stock or 
resulted in the issuance of common stock that then 
shared in the earnings of the entity.  The statement 
became effective for financial statements issued for 
periods ending after December 15, 1997, and requires 
restatement of all prior-period EPS data presented.
     Pursuant to the new statement, the basic and 
diluted earnings (loss) per common share were computed 
as follows:

Year-to-Date EPS Calculations     1998       1997

Net loss                       $(142,000) $(124,000)
Weighted average
  common shares outstanding    2,811,288  2,808,785
Incremental shares                 -         -      

Basic loss per share           $  (.05)    $  (.04)
Diluted loss per share         $  (.05)    $  (.04)

No incremental shares are included in the year-to-date 
EPS calculations due to the net loss in each period.


Quarterly EPS Calculations       1998        1997

Net earnings (loss)            $ 454,000  $ (102,000)
Weighted average common
  shares outstanding           2,811,590   2,809,003
Incremental shares                85,766      -      

Basic earnings (loss) per share $    .16  $     (.04)
Diluted earnings (loss)
  per share                     $    .16  $     (.04)

No incremental shares are included in the quarterly 
EPS calculations for 1997 due to the net loss in the 
period.


Note 8 - Employee Stock Options

     Employee stock options are accounted for under 
APB Opinion 25, Accounting for Stock Issued to 
Employees, and related interpretations.  The exercise 
price of each option equals the market price of the 
companys common stock on the date of grant.  
Accordingly, no compensation cost has been recognized.  
The company chose not to adopt Statement of Financial 
Accounting Standards No. 123, Accounting for Stock-
Based Compensation.  The fair value of the options 
under SFAS No. 123 is approximately $70,000 which is 
not deemed significant to earnings.
     Stock option transactions under the 1994 
Incentive Compensation Plan for each period are 
summarized as follows:

                       1998               1997 
                  Weighted           Weighted
                  Shares   Average    Shares  Average
                   Under   Exercise    Under  Exercise
                  Option     Price    Option    Price
Outstanding at
 beginning of
 year             150,000    $1.00    150,000   $1.00
Granted              -         -         -        - 
Exercised            -         -         -        - 
Forfeited            -         -         -        - 
Outstanding at
 end of October   150,000     $1.00   150,000   $1.00 


Options exercisable
 at end of October    -         -          -     -
Weighted average fair
 value of options
 granted during the
 year                 -         -          -     -

The following information applies to options 
outstanding at October 31, 1998:

Number outstanding                          150,000
Range of exercise prices                      $1.00
Weighted average exercise price               $1.00
Weighted average remaining contractual life 7.2 yrs.


Note 9 - Stock Warrants

     Pursuant to a settlement that ended a class 
action alleging racial discrimination in hiring by 
Torotel Products, Inc., the company agreed to issue a 
warrant certificate to the Torotel Settlement Fund to 
purchase 100,000 shares of Torotel, Inc. common stock 
at $.75 per share.  The warrant is 100% vested upon 
issuance and cannot be exercised until the market 
price of the companys common stock reaches $2.00 per 
share.  The warrant expires on May 4, 2003.
     The warrant is deemed non-compensatory under 
Statement of Financial Accounting Standards
No. 123, Accounting for Stock-Based Compensation.  
Stock warrant transactions for each period are 
summarized as follows:

                    1998               1997 
                  Weighted           Weighted
                  Shares   Average    Shares  Average
                   Under   Exercise    Under  Exercise
                  Option     Price    Option    Price
Outstanding at
 beginning of
 year                -         -         -        -  
Granted           100,000    $.75        -        - 
Exercised            -         -         -        - 
Forfeited            -         -         -        - 
Outstanding at
 end of October   100,000     $.75       -        - 


Warrants exercisable
 at end of October    -         -          -     -
Weighted average fair
 value of options
 granted during the
 year                 -         -          -     -

The following information applies to warrants 
outstanding at October 31, 1998:

Number outstanding                      100,000
Range of exercise prices                   $.75
Weighted average exercise price            $.75
Weighted average remaining
  contractual life                        4.5 yrs


Note 10 - Acquisition

     On November 24, 1998, the company signed a 
definitive merger agreement with Electronika, Inc. 
(formerly Caloyeras, Inc.), a private manufacturer of 
magnetic components.  Completion of the merger will 
depend upon a review of Torotels preliminary Proxy 
Statement by the Securities and Exchange

Commission (SEC), and approval by Torotels 
shareholders.  The completion of the merger also is 
dependent on the satisfactory completion of customary 
due diligence investigations by Torotel and 
Electronika, and the receipt and approval of the 
disclosure schedules required by the merger agreement 
by December 24, 1998.  The date of the shareholders 
meeting, as well as the Record Date for voting at the 
meeting, should be announced by mid-December.  If all 
of the approvals are obtained, the merger should be 
finalized by mid-February 1999.  These dates are 
subject to timely clearance by the SEC.  The terms of 
the merger include:
*   Torotel exchanging 1,800,000 of its common shares 
for all the outstanding Electronika shares.
*   Torotel depositing 2,500,000 shares of a new Class 
A $1.00 Preferred Stock (5 percent cumulative, non-
participating, non-convertible) into escrow for the 
benefit of the Electronika shareholders.  The 
Preferred Stock will be distributed annually over a 
five-year period based on Electronikas earnings 
performance following the merger.
*   Torotels founding family shareholders (the 
Sizemore Family) will form a Voting Trust or similar 
arrangement, allowing Peter Caloyeras (Electronikas 
founder) to vote 525,165 shares of common stock held 
by the Sizemore Family, which will represent 11.4% of 
Torotels outstanding common stock after the merger.  
After giving effect to the Merger and the Voting 
Trust, the Caloyeras family will hold, or direct the 
voting of, 54.9% of Torotels outstanding common stock.  
The term of the Voting Trust will coincide with the 
term of the Preferred Stock Escrow Period.


Note 11  Product Line Sale

     On September 18, 1998, Torotels wholly-owned 
subsidiary, OPT Industries, Inc., completed the sale 
of its ultra-miniature transformer and inductor 
product line to Pico Electronics, Inc. of Pelham, New 
York.  The company received cash proceeds of 
$1,250,000 from the sale, which resulted in a gain of 
$984,000, net of the value of the inventory and 
equipment associated with the product line.


Item 2.     MANAGEMENTS DISCUSSION AND ANALYSIS OR 
PLAN OF OPERATION


     The discussion and analysis of the results of 
operations includes the operations of Torotel, Inc., 
and its subsidiaries, Torotel Products, Inc. and OPT 
Industries, Inc.


SIX MONTHS ENDED OCTOBER 31, 1998 VERSUS SIX MONTHS 
ENDED OCTOBER 31, 1997

     Net sales decreased 30%.  The net sales of 
Torotel Products decreased 5% from $3,036,000 to 
$2,877,000 due primarily to lower sales of the potted 
coil assembly for the Hellfire II missile system.  In 
recent years, sales of the potted coil assembly have 
accounted for about 25% of Torotel Products total 
sales; however, future sales of the potted coil 
assembly will be significantly lower and limited only 
to the number of Hellfire II missiles sold to foreign 
countries by the prime contractor(s).  As a result, 
lower sales are expected at Torotel Products.  OPTs 
net sales decreased 51% from $3,606,000 to $1,772,000 
due primarily to lower sales of power supplies to a 
major customer.  No significant orders are expected 
from this customer at this time.  As discussed in Note 
11 of Notes to Consolidated Financial Statements, OPT 
sold its ultra-miniature transformer and inductor 
product line.  Sales from this product line for the 
six months ended October 31, 1997 and 1998, were 18% 
and 40% of OPTs total net sales, respectively.  As a 
result, OPT does not expect any significant increase 
in sales in the next few months.
     Gross profit as a percentage of net sales 
decreased 13%.  The gross profit percentage of Torotel 
Products decreased 6% due primarily to labor 
inefficiencies.  The gross profit percentage of OPT 
decreased nearly 28% due primarily to labor 
inefficiencies and lower sales volume without a 
comparable decrease in fixed production costs.
     Engineering expenses increased 5%.  The 
engineering expenses of Torotel Products decreased 10% 
from $141,000 to $126,000 due primarily to a $6,000 
decrease in equipment rental costs, a $6,000 decrease 
in payroll costs, and a $3,000 decrease in travel 
costs.  The engineering expenses of OPT increased 14% 
from $255,000 to $291,000 due to a $28,000 increase in 
payroll costs and an $8,000 increase in consulting 
costs.
     Selling, general and administrative (SG&A) 
expenses decreased 7%.  The SG&A expenses of Torotel, 
Inc. decreased 19% from $117,000 to $95,000 due 
primarily to a $14,000 decrease in professional fees 
and an $8,000 decrease in directors fees.  The SG&A 
expenses of Torotel Products decreased 6% from 
$556,000 to $523,000 due primarily to a $37,000 
decrease in professional fees, an $8,000 decrease in 
sales commissions, and an $8,000 decrease in computer 
maintenance costs.  These decreases were offset 
partially by an $8,000 management fee charge from OPT, 
an $8,000 increase in disposal costs for hazardous 
materials, and a $4,000 increase in copier rental 
costs.  The SG&A expenses of OPT decreased nearly 6% 
from $492,000 to $465,000 due primarily to an $23,000 
decrease in sales commissions, an $8,000 management 
fee credit from Torotel Products, a $5,000 decrease in 
payroll costs, and a $2,000 decrease in travel costs.  
These decreases were offset partially by an $11,000 
increase in advertising costs.
     Interest expense increased 27%.  The interest 
expense of Torotel, Inc. decreased slightly from 
$21,000 to $20,000.  The interest expense of Torotel 
Products increased nearly 35% from $60,000 to $81,000 
due to a higher aggregate borrowing level.  The 
interest expense of OPT increased 31% from $52,000 to 
$68,000 due to a higher aggregate borrowing level.
     Sundry non-operating income increased due to a 
$984,000 gain from the product line sale discussed in 
Note 11 of Notes to Consolidated Financial Statements.  
The six-month period last year had a sundry non-
operating expense of $71,000 which included a $70,000 
charge for an estimated penalty as discussed in Note 6 
of Notes to Consolidated Financial Statements.
     For the reasons discussed above, the consolidated 
pretax loss increased from $124,000 to $142,000.  The 
pretax loss of Torotel, Inc. decreased from $138,000 
to $115,000.  The pretax earnings of Torotel Products 
decreased from a profit of $10,000 to a loss of 
$95,000.  The pretax earnings of OPT increased from 
$4,000 to $68,000.


THREE MONTHS ENDED OCTOBER 31, 1998 VERSUS THREE 
MONTHS ENDED OCTOBER 31, 1997

     Net sales decreased 38%.  The net sales of 
Torotel Products decreased 12% from $1,458,000 to 
$1,285,000 due primarily to lower sales of the potted 
coil assembly for the Hellfire II missile system.  In 
recent years, sales of the potted coil assembly have 
accounted for about 25% of Torotel Products total 
sales; however, future sales of the potted coil 
assembly will be significantly lower and limited only 
to the number of Hellfire II missiles sold to foreign 
countries by the prime contractor(s).  As a result, 
lower sales are expected at Torotel Products.  OPTs 
net sales decreased nearly 60% from $1,807,000 to 
$731,000 due to lower sales of power supplies to a 
major customer.  No significant orders are expected 
from this customer at this time.  As discussed in Note 
11 of Notes to Consolidated Financial Statements, OPT 
sold its ultra-miniature transformer and inductor 
product line.  Sales from this product line for the 
three months ended October 31, 1997 and 1998, were 16% 
and 40% of OPTs total net sales, respectively.  As a 
result, OPT does not expect any significant increase 
in sales in the next few months.
     Gross profit as a percentage of net sales 
decreased 8%.  The gross profit percentage of Torotel 
Products increased 3% due primarily to lower fixed 
production costs.  The gross profit percentage of OPT 
decreased 28% due primarily to labor inefficiencies 
and lower sales volume without a comparable decrease 
in fixed production costs.
     Engineering expenses increased 14%.  The 
engineering expenses of Torotel Products decreased 9% 
from $68,000 to $62,000 due primarily to a $3,000 
decrease in payroll costs and a $3,000 decrease in 
equipment rental costs.  The engineering expenses of 
OPT increased 26% from $121,000 to $153,000 due 
primarily to a $28,000 increase in payroll costs and 
an $8,000 increase in consulting costs.  These 
increases were offset partially by a $4,000 decrease 
in small tools and supplies expenditures.
     Selling, general and administrative (SG&A) 
expenses decreased 11%.  The SG&A expenses of Torotel, 
Inc. decreased 20% from $64,000 to $51,000 due 
primarily to a $7,000 decrease in professional fees, a 
$3,000 decrease in directors fees, and a $3,000 
decrease in consulting costs.  The SG&A expenses of 
Torotel Products decreased 8% from $257,000 to 
$236,000 due primarily to a $6,000 decrease in payroll 
costs, a $4,000 decrease in sales commissions, a 
$4,000 decrease in advertising costs, a $4,000 
decrease in computer maintenance costs, and a $3,000 
decrease in professional fees.  The SG&A expenses of 
OPT decreased 11% from $240,000 to $214,000 due 
primarily to a $14,000 decrease in sales commissions, 
an $8,000 decrease in payroll costs, and a $4,000 
decrease in travel costs.
     Interest expense increased 30%.  The interest 
expense of Torotel, Inc. decreased slightly from 
$11,000 to $10,000.  The interest expense of Torotel 
Products increased 26% from $31,000 to $39,000 due to 
a higher aggregate borrowing level.  The interest 
expense of OPT increased 54% from $24,000 to $37,000 
due to a higher aggregate borrowing level.
     Sundry non-operating income increased due to a 
$984,000 gain from the product line sale discussed in 
Note 11 of Notes to Consolidated Financial Statements.
     For the reasons discussed above, consolidated 
pretax earnings increased from a loss of $124,000 to a 
profit of $454,000.  The pretax loss of Torotel, Inc. 
decreased from $75,000 to $61,000.  The pretax loss of 
Torotel Products decreased from $39,000 to $20,000.  
The pretax earnings of OPT increased from $12,000 to 
$535,000.


LIQUIDITY AND CAPITAL RESOURCES

     Historically, the company has relied on funds 
generated internally and bank borrowings to meet its 
normal operating requirements and to service bank 
indebtedness.  For the fiscal year ended April 30, 
1998, the company incurred a pretax loss of 
$1,295,000.  For the six months ended October 31, 
1998, the company incurred an additional operating 
loss of $1,126,000; however, this loss was offset 
substantially by the $984,000 gain from the product 
line sale discussed in Note 11 of Notes to 
Consolidated Financial Statements.  Management does 
not anticipate any significant increase in the present 
rate of sales during the next few months.  As a 
result, further operating losses are expected.  As of 
October 31, 1998, the company was in violation of two 
financial covenants under the terms of its credit 
agreement with PNBT (see Note 5 of Notes to 
Consolidated Financial Statements); however, the bank 
has waived compliance with the subject provisions 
through January 31, 1999, which is the verbal 
expiration date of the credit line.  PNBT is in the 
process of reviewing the entire credit arrangement, 
along with the anticipated benefits to be derived from 
the possible acquisition discussed in Note 10 to Notes 
to Consolidated Financial Statements.  While 
management believes the bank has an interest in 
continuing as the companys primary lender, renewal of 
the credit line will be subject to, among other 
things, satisfactory review of the companys operating 
plans, cash needs, available collateral, and the 
status of the acquisition.  If the bank does not renew 
the credit line, it could affect the companys ability 
to continue as a going concern (see Note 2 of Notes to 
Consolidated Financial Statements).
     During the six months ended October 31, 1998, the 
companys operating activities used $743,000 in cash 
flow.  Corporate related matters used $248,000.  The 
operations of Torotel Products provided $455,000 due 
primarily to a lower level of receivables.  OPTs 
operations used $950,000 due primarily to the losses 
from operations.
     Investing activities provided $1,209,000 in cash 
flow due to the product line sale discussed in Note 11 
of Notes to Consolidated Financial Statements.  For 
the six months ended October 31, 1998, capital 
expenditures for production and engineering equipment 
were $41,000.  For the balance of the fiscal year, the 
company anticipates additional investments of 
approximately $15,000 for capital expenditures.
     Financing activities used $439,000 in cash flow 
due primarily to decreases in the revolving credit 
line and long-term debt.  At October 31, 1998, the 
company had used $1,203,000 of its revolving credit 
line and had $497,000 available for future cash 
requirements, based on the lenders borrowing base 
formula.
     The company believes that inflation will have 
only a minimal effect on future operations since such 
effects will be offset by sales price increases which 
are not expected to have a significant effect upon 
demand.
YEAR 2000 READINESS

     Management is presently assessing both operating 
companies for their Year 2000 readiness.  Extensive 
testing has been performed on the main operating 
system and its software applications (which serves 
both operating companies), and it has been determined 
that both hardware and software are Year 2000 
compliant.  Both operations are in the process of 
polling significant suppliers and customers to 
determine the extent to which either operation is 
vulnerable to those third parties failure to remediate 
their own Year 2000 issues.  In addition, various 
equipment is being tested to verify its Year 2000 
functionality.  The cost of these efforts has been and 
should continue to be minimal.
     The company believes all necessary steps are 
being taken to assure a smooth transition to the Year 
2000.  However, there is no guarantee that the systems 
of major suppliers and customers will be timely 
converted and would not have a material adverse effect 
on the company.


OTHER

     Except for historical information contained 
herein, certain of the matters discussed above are 
forward-looking statements within the meaning of the 
Private Securities Litigation Reform Act of 1995, and 
are subject to the safe harbor created by that Act.  
These statements are based on assumptions about a 
number of important factors and involve risks and 
uncertainties that could cause actual results to be 
different from what is stated here.  These risk 
factors include: decreased demand for products, delays 
in developing new products, expected orders that do 
not occur, loss of key customers, the DOD calling for 
payment of the accrued penalty and assessing 
additional fees, the impact of competition and price 
erosion as well as supply and manufacturing 
constraints, approvals not obtained for the proposed 
acquisition and that the required disclosure schedules 
may be disapproved by either Torotel or Electronika, 
and other risks and uncertainties.



PART II.     OTHER INFORMATION


Item 1.     Legal Proceedings

     There is one legal proceeding involving the 
company.  On May 6, 1997, Torotel Products, Inc. was 
accepted into the Voluntary Disclosure Program by the 
Inspector General of the United States Department of 
Defense, resulting from its failure to perform some 
required testing as frequently as required, and 
inaccurately certifying that all required testing had 
been performed.  As a result of the companys 
investigation into the testing deficiencies, the 
company has recorded an estimated charge of $486,000 
against earnings.  The estimated penalty is still 
subject to fluctuation as further evidence is 
investigated.  The company believes that certain of 
its former officers may have been responsible for the 
misconduct related to the test failures, and will 
evaluate ways of recovering the damages once the 
government completes its investigation.  In the 
meantime, the company has suspended all payments under 
a note payable to a former officer.


Item 6.   Exhibits and Reports on Form 8-K

a)   Exhibit 27 -- Financial Data Schedule (electronic 
filings only)
b)   Reports on Form 8-K -- There was one report filed 
on Form 8-K during the three months ended October 31, 
1998.  The report was dated August 17, 1998, and 
included information on the product line sale to Pico 
Electronics, Inc., as required by Item 5 of Form 8-K.








                    SIGNATURES


     In accordance with the requirements of the 
Securities Exchange Act of 1934, the Registrant caused 
this report to be signed on its behalf by the 
undersigned, thereunto duly authorized.


Torotel, Inc.
(Registrant)




Date:   December 11, 1998      /s/  H. James Serrone
                               H. James Serrone
                               Vice President of 
                               Finance and 
                               Chief Financial Officer